Safina Deputy Party Leader Willis Evans Otieno has criticised Kenya’s governance and tax policies, warning that a punitive VAT regime and institutional failures are driving economic strain.
He says businesses face cash flow crises, rising compliance burdens, and shrinking demand, while leaders abandon accountability, deepening a national crisis affecting healthcare, employment, and overall economic stability.
In a statement posted on X on Monday, Otieno painted a bleak picture of the country’s current state, highlighting systemic challenges in healthcare, employment, and economic stability.
“Hospitals are bereft of essential medicines, mothers are detained for the mere act of giving life, youth unemployment has metastasized into a full-blown national emergency, and the economy is hemorrhaging from every conceivable artery,” he said.
He sharply criticised Members of Parliament, accusing them of abandoning their constitutional mandate in favour of political loyalty and theatrics. “Our MPs are reduced to chanting ‘Tutam! Tutam!’ like obsequious court jesters rather than functioning as agents of reform,” he stated.
According to Otieno, lawmakers have failed in their core responsibilities. “These are the very individuals constitutionally mandated to safeguard the rule of law, rigorously interrogate policy, and act as custodians of the public purse,” he said. “Instead, they have abdicated this solemn responsibility, opting for sycophancy over representation, blind allegiance over institutional duty, and vacuous theatrics over principled leadership.”
The Safina Deputy Leader also turned his focus to Kenya’s tax framework, singling out the Value Added Tax (VAT) system as a major impediment to economic growth. He described the regime as excessively burdensome and structurally flawed.
“Kenya’s VAT regime has evolved into a fiscally extractive mechanism that imposes a disproportionate burden on both enterprises and consumers,” he said.
Otieno argued that small and medium-sized enterprises (SMEs) are particularly affected, as they are required to remit VAT based on invoiced amounts rather than actual payments received. “Small and medium-sized businesses are compelled to remit VAT on accrual rather than actual receipts, thereby precipitating acute cash flow constraints,” he noted.
He added that delayed or defaulted payments by clients exacerbate the situation, pushing businesses into financial distress. “Compounded by protracted VAT refund cycles, this effectively immobilizes working capital,” he said. “Firms are forced into the unenviable position of inflating prices or contracting operations merely to remain solvent.”
Beyond the financial strain, Otieno criticised the administrative framework surrounding VAT compliance, describing it as excessively complex and punitive. “The compliance architecture is equally onerous, labyrinthine, punitive, and often indiscriminate,” he said.
He pointed to frequent audits, strict invoice-matching requirements, and heavy penalties as factors that create a difficult business environment.
“Frequent audits, stringent invoice-matching requirements, and severe penalties create a hostile operating environment,” he said, arguing that such measures disproportionately target compliant businesses.
“In effect, the system rewards opacity and punishes transparency,” he added.
Otieno warned that the broader economic implications of the current tax regime are already becoming evident. “The macroeconomic consequences are predictable, elevated consumer prices, suppressed aggregate demand, and a steady exodus of enterprises from the formal sector,” he said.
He further cautioned that increasing consumption taxes beyond a certain threshold could have the opposite of their intended effect.
“Beyond a certain inflection point, escalating consumption taxes cease to be revenue-enhancing and instead become economically contractionary,” he argued.
According to him, such policies risk weakening the country’s economic foundation. “They erode the tax base, dampen productivity, and ultimately undermine the very fiscal objectives they are designed to achieve,” he said.
Otieno’s remarks add to growing public debate over taxation, governance, and economic policy, as concerns mount over the cost of living and the sustainability of Kenya’s fiscal strategy.