“Stop Raising Tax Rates,”: IMF Delivers Blunt Warning to President Ruto

 The International Monetary Fund (IMF) has issued a firm policy warning to President William Ruto’s administration, urging Kenya to widen its tax net instead of imposing higher tax rates on overburdened citizens.

The advice comes as Kenya navigates severe fiscal stress and rising public debt, challenges that have significantly compounded the cost-of-living crisis across households. Critics and civil society groups argue that the government’s reliance on aggressive levies and new tax measures has squeezed ordinary wage earners while failing to capture underreported economic sectors.

In its latest fiscal evaluation, the IMF emphasized that raising rates further risks dampening economic growth and fueling public discontent. Instead, the Washington-based lender advised the Kenya Revenue Authority (KRA) to prioritize structural reforms, curb tax evasion, and streamline collection processes to bring non-compliant businesses into the tax fold.

The directive puts fresh pressure on the National Treasury as it prepares upcoming fiscal proposals.

While the Ruto administration maintains that revenue mobilization is essential to service national debt and finance development projects, economic analysts warn that ignoring the IMF’s call to broaden the tax base could stifle domestic investment and trigger further economic hardship.

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