Excerpts by @JGMBugua of today’s budget speech that was read in the Kenya Parliament, by the National Treasury Cabinet Secretary, Henry Rotich.
- Grumbles still rumbling through Parliament as members realize they have been snookered and the Waiguru motion is dead
- Kenya Revenue Authority (KRA tax collection) target set at Kshs 1.1 trillion for the coming year i.e. ~$12.5 billion
- Financial Services Authority to be established… We should be aware the FSA in the UK had to be split and some of its oversight functions returned to the Bank of England after systemic failures during the global financial crisis. The more apparent implication of establishing the Financial Services Authority is that it would likely see the collapse and merging of…the Capital Markets Authority, the Insurance Regulatory Authority, SASRA (for Saccos), the Retirement Benefits Authority and so on..
- Three new airports to be built in Mandera, Malindi and Suneka (?)
- Duty rates on import of iron and steel products increased from 0% – 25% – apparently to protect local industries
- KRA ordered to stop demanding custom bond from importers of refined industrial sugar and wheat…Those barons lobbied hard
- Import of inputs for seed processing exempted from duty.
- Govt moves to block multinationals from evading tax through transfer pricing where the local subsidiary buys from its mother company at exaggerated prices hence reporting little or no profits. “To keep the relationship at an arms length…” Rotich
- Stock market brokers win big as government and the Investor Compensation Fund forced to retreat and accept only 5% shareholding each in the demutualized stock exchange..Brokers to share 90%.