Will Ruto’s long-game gamble with taxes pay off?

This week’s official visit to Japan offered Kenyan President William Ruto a welcome break from the negative public sentiment that has surged back home in recent months over his administration’s aggressive tax policies and perceived failure to bring down the cost of living.

At a meeting with the Kenyan diaspora in Tokyo, President Ruto looked fairly cheerful, even calming himself at some point to make a joke at his own expense over his new moniker “Zakayo”—a comparison to the biblical Zacchaeus the tax collector.

“What I will not do as president is say there will be free lunch, that the country is going to be developed by borrowing from other people, and that it is going to cost us nothing to develop our country. That is why I don’t mind people calling me names… I will do the right thing for our country irrespective of what names people call me, including Zakayo,” he said amid applause and chuckles from the audience on Wednesday.

The atmosphere in the room contrasted sharply with the pockets of hostility his entourage has recently encountered at public rallies organized for the President to try to explain his social and economic agenda.

While the hostility has mostly been directed at local political allies, it has given a glimpse of the souring sentiment about the President and his administration, including in his perceived political support bases.

Ahead of his State of the Nation Address in Parliament in November last year, several MPs at a parliamentary group meeting for the ruling Kenya Kwanza were reported to have warned him about negative perceptions of the government on the ground.

Ruto is said to have rejected the legislators’ proposal for a review of taxes, telling them, “You cannot be popular all the time; there is a time to be unpopular”.

He was widely understood to be alluding to a long-game political strategy in which he will stubbornly push through with his unpopular policies in the first three or four years of his first term then review them close to the 2027 campaign to appear responsive to public sentiment, enhancing his chances of winning a second term.

Several senior administration figures have in the past hinted at such a strategy, urging Kenyans on several occasions to tighten their belts for three years before the economy gets better. The administration of his predecessor Uhuru Kenyatta was seen to offer generous consumer subsidies close to his re-election campaign in 2017.

For Ruto however, the long-game gamble could prove too risky given his administration seems to be caught between a rock and a hard place on most issues.

For instance, the Central Bank of Kenya (CBK) in a bid to tame inflation and protect the shilling this week adjusted its base lending rate significantly upwards, increasing interest rates to highs last seen 12 years ago.

And the return of the high interest rates regime is expected to further squeeze private sector credit, slow down business activity and trigger job cuts.