KAM statement on Fees and Charges Imposed on Businesses

Kenya Association of Manufacturers (KAM) would like to register its concern on the unfair imposition of fees and charges on businesses, by Kenya Revenue Authority (KRA), on behalf of Nairobi Metropolitan Services (NMS) as follows:

  • Landing charges unfairly imposed on livestock delivered to Nairobi County from other counties outside the NMS jurisdiction. To cater for the additional cost, farmers raise the prices of their livestock (and livestock products), thereby increasing the cost of production for manufacturers who buy from them. The overall cost of doing business in this case undoubtedly falls on the buyer – the Citizens. 
  • Export levy introduced in the proposed changes in food safety and export processes, through the NMS Export Certification. This proposal goes outside of the public health inspection mandate of the NMS. Furthermore, the charge is in addition to the public health inspection fee, charged by the National Government.

This year projects a lot of uncertainty for businesses, as we re-emerge from the disruption of the pandemic, as well as the upcoming general elections. This is the time to reassure and give confidence to investors and the business community. Uncoordinated fees and charges, that make the business environment untenable, do the exact opposite.  

The new costs not only render the manufactured goods uncompetitive but also exacerbate an already dire situation as Kenyans try to make ends meet. Additionally, they go against all efforts to eliminate multiple levies across counties in the agriculture value chain, as outlined in the Food Security and Nutrition Pillar of the Big 4 Agenda.

These charges contravene Article 209 (5) of the Constitution, which requires that taxation and other revenue-raising powers of a county shall not be exercised in a manner that prejudices national economic policies, economic activities across county borders, or the national mobility of goods, services, capital, or labour.

The local manufacturing sector is keen to get Kenya back on track towards achieving a double-digit GDP contribution, but this will not happen if county governments continue to increase fees, levies, and charges at the cost of our economic recovery.

We urge KRA and NMS to cease the above-mentioned unnecessary increments of charges to businesses. Even as they focus on sufficient revenue collection for enhanced service delivery, it is critical that we all prioritize actively creating room for sustainable economic growth through inter-county trade.

 

Phyllis Wakiaga

Chief Executive, KAM 

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