How Punitive tax measures has hurt Kenya's Economy

 Photo: KICC, Nairobi Kenya

Kenya's economy is towering the brink of total collapse as investors shun the country over punitive tax measures imposed by the government.

Kenyans are glaring at tough times ahead, excerbated by increased cost of living, amidst a raging inflation that has seen the weakening of the Kenya Shilling against the US Dollar.

Kenya's inflation Consumer Price Index (CPI) is at around 135.32 points.

CPI is derived from the change in the prices of a basket of goods and services that are normally bought by specific household groups.

Is Kenya really doing well economically?

The question as to whether Kenya is doing well economically is a rhetorical one as the apparent answer is a capital NO.

President William Ruto's regime developed an insatiable tax appetite that has left a majority of the country's populace seeking alternative ways to earn a living devoid of the government watch.

A recent report indicating that most Kenyans are spending more time on unproductive activities is a clear signal that the mass is geared towards despondence and disillusionment.

Multiple reports indicate that most Kenyans are idle and can't engage in meaningful productive activities. 

16 hours daily time on unproductive activities deny the country billions of shillings annually.

Kenya National Bureau of Statistics came up with a report on how Kenya's economy is struggling hard to create jobs, forcing thousands of graduates to the informal sector while others are giving up.

Industries are closing up over increased taxation, rendering thousands jobless. The unemployed end up in the informal sector denying the government the vital tax.

What is Kenya's main Economy?

Kenya is an economic hub in the entire East African region, despite some setbacks catalyzed by the political class.

Agriculture remains a major economic activity in Kenya and a key contributor to the Country's GDP.

In East African States, Kenya is the most industrialized, yet majority of its citizens are still wallowing in poverty and distress.

The main contributors to Kenya's Gross Domestic Product (GDP) are agriculture (29%), industries (18%) and services (53%).

Kenya trades with other countries, wi

under the banner of notable trade organizations namely: AU, COMESA, AFCTA, WTO, CENSAD among others.

The country's export goods include: coffee, tea, pyrethrum, horticultural products, petroleum products, cement, fish, apparel among many others.

What is the GDP of Kenya?

A Country's GDP is determined by the monetary value or market value of processed products within its borders.

As of 2022, Kenya's GDP stood at 118.1billion USD.

The economy of Kenya is market based where price signals guide decisions related to investment, production and distribution.

Price signals are normally dictated by the forces of demand and supply.

How Kenya's GDP is Calculated 

The Gross Domestic Product includes the sum of consumption, investment, government expenditures and net exports.

GDP = Consumption + Investment + Government Spending + Net Exports

Where Net Exports = Kenya Exports - Kenya Imports

GDP = C + I + G + NX