Kenyan police fired tear gas and rubber bullets to disperse young protesters in the capital Nairobi on Tuesday, AFP reporters saw, escalating tensions as demonstrators rallied across the country against proposed tax hikes.

The mainly Gen-Z-led rallies, which began last week, have caught President William Ruto's government off guard.

The Kenyan leader said over the weekend he was prepared to talk to the protesters, while praising their "peaceful" action.

But hundreds of chanting demonstrators were met by a heavy police presence early Tuesday in Nairobi's business district.

Officers in full riot gear blocked access to parliament, where lawmakers are debating a finance bill containing the tax proposals.

"We are peaceful", demonstrators shouted, as police fired tear gas and rubber bullets into the crowd, according to AFP reporters.

Anger over a cost-of-living crisis spiralled into nationwide rallies last week, with demonstrators calling for the finance bill to be scrapped.

Parliament must vote on the legislation by June 30.

"There is no criminality in assembling in the streets," father-of-one Kennedy Sankara, 26, told AFP, condemning officers.

"They are here brutalising innocent citizens who are unarmed and only speaking."

Describing Ruto's bill as "draconian", Sankara accused the authorities of "trying to brutalise us."

Crowds also marched in the port city of Mombasa, the opposition bastion of Kisumu, and Ruto's stronghold of Eldoret, images on Kenyan TV channels showed.

The protests have been mostly peaceful, as Ruto noted Sunday in his first public comments on the demonstrations.

But the Independent Policing Oversight Authority watchdog and rights groups said that two people had died following Thursday's rallies in Nairobi.

Several organisations, including Amnesty International Kenya, said at least 200 people were wounded in last week's protests in Nairobi.

- 'At a crossroads' -

Amnesty's Kenya chapter posted on X Tuesday that "the pattern of policing protests is deteriorating fast", urging the government to respect demonstrators' right to assembly.

On Monday, ahead of the rallies, the rights body said Kenya was "at a crossroads".

"Despite mass arrests and injuries, the protests have continued to grow, emphasising the public's widespread discontent," it said, warning that "the escalation of force could lead to more fatalities and legal repercussions."

Rights watchdogs have accused the authorities of abducting protesters in violation of the law.

The Kenya Human Rights Commission said the abductions had mostly occurred at night and were "conducted by police officers in civilian clothes and unmarked cars", calling for the "unconditional release of all abductees."

Police have not responded to AFP requests for comment on the allegations.

The protesters have also deployed unconventional tactics, including asking bars to stop playing music at midnight on the weekend as partygoers burst into chants of "Ruto must go" and "Reject finance bill."

Their demonstrations have drawn support from some Anglican and Catholic church leaders.

- Debt mountain -

The cash-strapped government agreed last week to roll back several tax increases.

But it still intends to raise other taxes, saying they are necessary for filling the state coffers and cutting reliance on external borrowing.

Kenya has a huge debt mountain whose servicing costs have ballooned because of a fall in the value of the local currency over the last two years, making interest payments on foreign-currency loans more expensive.

The tax hikes will pile further pressure on Kenyans, with well-paid jobs remaining out of reach for many young people.

After the government agreed to scrap levies on bread purchases, car ownership and financial and mobile services, the treasury warned of a budget shortfall of 200 billion shillings ($1.56 billion).

The government now intends to target 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 saddled with high inflation.

Kenya has one of the most dynamic economies in East Africa but a third of its 52 million people live in poverty.