Kenyan Lawmakers Oppose Tax Authority’s Push for Financial Data

Kenya’s finance committee in parliament has turned down a proposal that would have permitted the country’s revenue service to freely obtain taxpayers’ personal financial details, raising alarms over potential privacy breaches and conflicts with constitutional rights.

This controversial plan, which was part of the latest finance legislation, triggered widespread criticism among the public, who saw it as an invasion of privacy.

According to the committee, existing regulations already empower the Kenya Revenue Authority (KRA) to seek financial records, but only after receiving court approval. As a result, the proposed changes were seen as redundant.

“In light of these existing safeguards, the committee concluded that the proposed provision is both unnecessary and potentially unconstitutional,” the report said.

Finance Minister John Mbadi argued that the clause would be useful in uncovering cases of tax evasion, especially by wealthy citizens who hide their assets using legal protections.

Efforts to get an immediate reaction from Mbadi regarding the committee’s rejection were unsuccessful.

Since President William Ruto assumed office in 2022, his administration has been keen on widening the tax net in order to meet rising debt repayment obligations.

Following last year’s finance bill, violent demonstrations erupted over tax hikes, resulting in numerous fatalities. In light of this, Mbadi assured that no new taxes or increases would feature in this year’s proposal.

Still, the government plans to gather an additional 30 billion shillings ($233 million) by enforcing stricter tax compliance rather than introducing fresh levies.

The finance minister had emphasized that such access to financial data was key for officials to spot potential tax dodgers among both companies and individuals.

Authorities are eager to prevent the kind of chaos sparked by last year’s tax-related unrest, which saw more than 50 deaths and forced the administration to abandon an earlier tax increase plan that sought to generate 346 billion shillings.

A final decision on the bill will depend on an upcoming parliamentary vote before it reaches President Ruto for assent.