Parliament is in a tussle with the government over passing of the Finance Bill 2011. The government has differed with parliament over, among other things,  the capping of bank interest rates.

Failure to have the Finance Bill passed by parliament essentially makes it illegal for government to be collecting taxes in the current period.

Mr.Elias Mbau, chairman of the Budget Committee has expressed concern that the government risks being taken to court for collecting taxes illegally. Speaking to the press at the launch of Parliament’s macroeconomic model for policy analysis and forecasting, Mr. Mbau said that Banks have been raking in huge harvests in interest and dividends as the public languishes in poverty.

He said that if the bill was not passed, civil society and other organizations could be compelled to mobilize Kenyans to stop paying taxes.

The graduating interest rates set by banks have been running down businesses due to the uncertainty that comes with the repayment of loans. Individuals in the recent days have been skeptical about the many loan products given by banks for fear of the unpredictable future and repayment terms.

The macroeconomic model for policy analysis and forecasting will aid Parliament to scrutinize budget proposals by the executive, approve them, vary them or reject the proposals.