Kiharu Member of Parliament Ndindi Nyoro has voiced strong concerns over President William Ruto’s economic policies, cautioning that Kenya’s escalating debt and heavy taxation could lead the nation toward a financial crisis. Speaking on April 15 during the launch of a shadow budget for the 2025/2026 fiscal year, Nyoro emphasized that the country’s current fiscal trajectory is unsustainable and risks defaulting on its loans.
Nyoro, who previously chaired the Budget and Appropriations Committee until February 2025, highlighted the dangers of over-reliance on debt and taxation as tools for economic growth. He argued that increasing tax rates does not always lead to higher revenue, referencing the Laffer Curve to illustrate how excessive taxation can result in diminishing returns. “One way you cannot get out of the hole is by continuing to dig it,” Nyoro stated, warning that high taxes distort economic decisions and reduce overall revenue.
The MP pointed out that despite tax hikes introduced through the Finance Bills of 2022 and 2023, Kenya’s revenue-to-GDP ratio has declined. In 2019–2020, the ratio stood at around 15%, dropping to 14% in 2023, and currently hovering at approximately 14.7%. Nyoro stressed that effective tax policies should lead to revenue growth, not decline.
He also criticized protectionist economic policies, drawing parallels with Nigeria’s experience. While acknowledging that protecting domestic production can be beneficial, Nyoro warned that overuse of such strategies could have long-term negative consequences. He cautioned against Kenya becoming a case study like Sri Lanka, which faced a severe economic crisis in 2022–2023 due to unsustainable fiscal policies.
Nyoro’s remarks signal a significant shift, as he was once a key ally in President Ruto’s economic team. His public dissent may spark debate within the Kenya Kwanza coalition regarding the nation’s fiscal direction. As Kenya’s public debt approaches KSh 12 trillion by the end of the 2025/2026 financial year, the call for prudent and research-based economic policies becomes increasingly urgent.
