Gachagua rejects Ruto's budget, Finance Bill as battle over economy intensifies

"The Finance Bill 2026 is taxing Kenyans into poverty. It is a killer and a threat to the common mwananchi. It will break households while stifling the freedom of Kenyans," Mr Gachagua said.

He was speaking on Friday during the unveiling of an “alternative budget” at the DCP party headquarters. 

The former Deputy President said the proposed Sh4.82 trillion budget and the Finance Bill represented "a twin evil" that would heap additional burdens on workers, farmers, small businesses, manufacturers, boda boda operators and low-income households already struggling with the high cost of living.

"We affirm that a national budget must be a plan for prosperity, a blueprint for opportunity, and a statement that gives priority to the people and not cake for a few elites," he said. "This budget does the exact opposite by violating the Constitution and in effect waging a terrifying economic war against Kenyans."

Mr Gachagua's criticism comes days before Treasury Cabinet Secretary John Mbadi is expected to table the budget estimates and Finance Bill before Parliament amid heightened public scrutiny over taxes and government spending.

He faulted the administration over what he termed excessive borrowing, claiming the government intends to borrow more than Sh1.1 trillion in the next financial year despite the country's growing debt burden.

"The government is presenting to us a budget with an intention to borrow Sh3.13 billion per day," he said. "Our public debt stands at Sh13 trillion. The government is working first for lenders, then for the people."

The DCP leader also accused the government of neglecting critical sectors while increasing allocations to administrative spending and the presidency.

According to Mr Gachagua, education funding has dropped to 16.2 percent of the budget under the current administration; agriculture receives only two percent while health has been allocated 3.5 percent despite increasing deductions under the Social Health Authority (SHA).

"What is the future of our children? Why is this regime at war with our children and our youth? Why are you killing our future?" he posed.

On agriculture, he questioned why the government had reduced funding to a sector that supports millions of livelihoods.

"Mr President, why are you de-funding agriculture? Did you consult the over 7.1 million registered farmers?" he asked.

 Mr Gachagua reserved some of his sharpest criticism for the Finance Bill, which he claimed introduces new taxes and compliance requirements despite repeated failures by the government to meet its revenue targets.

Also Read: Opposition faults Ruto over Ebola facility, rejects Finance Bill 2026

"The Finance Bill 2026/27 is the worst in the history of Kenya. It does not deserve to see the light of day," he said.

He singled out proposals to subject digital payment service commissions to 16 percent VAT, increase excise duty on mobile phones from 10 percent to 25 percent and alter VAT treatment on solar products, animal feeds and electric mobility equipment.

"Taxing these services will increase costs for traders, SMEs, schools, hospitals and ordinary citizens who rely on mobile payments," he said. 

He further argued that increasing taxes on mobile phones would disproportionately affect young people and low-income households.

"Mobile phones are no longer luxury goods; they are essential tools for education, business, communication, financial services, and job searching," he said.

Mr Gachagua also opposed a proposed withholding tax on non-resident landlords and provisions granting tax authorities greater powers to recover taxes even when disputes are pending before tribunals and courts.

Also Read: Taxpayers to spend Sh2.31 trillion on debt repayment, interests

"Kenya cannot tax its way to prosperity," he said, arguing that the government should instead focus on reducing waste, sealing revenue leakages, paying pending bills owed to businesses, and broadening the tax base.

As part of its alternative economic plan, DCP proposed abolishing the housing levy, reducing non-essential government expenditure, slowing debt accumulation and increasing allocations to agriculture and healthcare.

The party also wants Parliament to reject both the budget estimates and the Finance Bill.

"We call on all elected representatives of the people to listen to the people and reject this budget estimate and Finance Bill 2026/27," Mr Gachagua said.

He has further urged Kenyans to keep track of how their representatives vote on the measures.

 "We must call out all elected leaders supporting this reckless budget estimate and punitive Finance Bill 2026/27. Keep a record of those who will stand with the Kenyan people and those who will stand with this reckless regime," he said.

Mr Gachagua said a DCP government would slash the proposed Sh4.82 trillion budget to Sh3.67 trillion, eliminate new borrowing, scrap the housing levy and redirect spending towards agriculture and healthcare.

Under the alternative plan, agriculture funding would rise from Sh97 billion to Sh300 billion, while health would receive Sh450 billion, up from Sh167.4 billion. 

The party also proposes cutting public administration expenditure from Sh354.9 billion to Sh250 billion, reducing allocations to non-essential government spending and State House, and using the savings to support food production, healthcare, education, SMEs and job creation.

He argued that Kenya should balance its budget without taking on additional debt and focus on productive sectors that directly improve livelihoods.

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