Thousands of mostly young demonstrators took to the streets across Kenya on Thursday to protest tax hikes, blowing whistles and chanting slogans in a vivid show of anger by Gen-Z protesters against the government.

Police in the capital Nairobi fired tear gas and water cannon against groups of protesters near parliament, but apart from isolated scuffles earlier in the day, the action -- dubbed "Occupy Parliament" -- remained mostly peaceful.

Led largely by young Kenyans, the demonstrations began in Nairobi on Tuesday before spreading nationwide on Thursday.

They have galvanised widespread discontent over President William Ruto's economic policies in a country already grappling with a cost-of-living crisis.

Hours after Tuesday's demonstrations, which saw hundreds of youth face off against the police, the cash-strapped government agreed to make concessions, rolling back several of the tax hikes laid out in a new bill.

But the government still intends to go ahead with some tax increases and has defended the proposed levies as necessary for filling its coffers and cutting reliance on external borrowing.

On Thursday, protests were held across Kenya, with thousands assembling across Nairobi, the Indian Ocean city of Mombasa, the Rift Valley city of Nakuru and the opposition bastion of Kisumu, according to AFP reporters and images broadcast on TV.

Isolated scuffles broke out in Nairobi between protesters and police, who used tear gas and water cannon at demonstrators gathering near the parliament, which began debating the bill on Wednesday.

Despite a heavy police presence and roadblocks erected along several roads leading to parliament, hundreds of protesters gathered in groups, blowing whistles and vuvuzelas, waving placards and chanting: "Ruto must go".

Ivy, a 26-year-old job seeker dressed in a T-shirt and leggings, told AFP she was prompted to protest for the first time on Thursday because she was "scared" for her future.

"This bill cannot pass. This bill is going to finish us. We don't have jobs... we can't even open businesses, we can't do anything in this country," she said.

Another first-time protester, Bella, said she had showed up "to make sure the finance bill is rejected."

The 22-year-old university graduate told AFP she was "not impressed" with the government's concessions earlier this week.

- 'Lying to us' -

The presidency on Tuesday announced the removal of proposed levies on bread purchases, car ownership as well as financial and mobile services, prompting a warning from the treasury of a 200-billion-shilling shortfall as a result of the budget cuts.

The government has now targeted an increase in fuel prices and export taxes to fill the void left by the changes, a move critics say will make life more expensive in a country already battling high inflation.

"They are just trying to lie to us, the taxes that they have removed on bread they have added somewhere else," Bella said, describing it as a tactic to "blindfold" citizens.

A parliament source told AFP that a vote on the proposals was expected on June 27, three days before the deadline for passing the bill.

The taxes were projected to raise 346.7 billion shillings ($2.7 billion), equivalent to 1.9 percent of GDP, and reduce the budget deficit from 5.7 percent to 3.3 percent of GDP.

- High inflation -

The protest in Nairobi on Tuesday saw black-clad protesters forced into cat-and-mouse chases with police who fired volleys of teargas.

At least 335 people were arrested, according to a consortium of lobby groups including the human rights commission, KNCHR, and Amnesty Kenya.

"We have changed tack. Today we will be in colourful and defiant clothing to avoid a repeat of them arresting everyone in black," said an organiser of the march, who requested anonymity due to fear of reprisals.

Kenya is one of the most dynamic economies in East Africa but a third of its 51.5 million people live in poverty.

Overall inflation has remained stubbornly high, at an annual rate of 5.1 percent in May, while food and fuel inflation stood at 6.2 percent and 7.8 percent respectively, according to central bank data.