Counties with the cheapest trade permit fees revealed

Predominantly rural counties have the lowest business licensing fees while cities charge the highest, according to the findings of a new survey.

The survey by small and medium enterprises consultancy firm Viffa Consult says Bungoma, Uasin Gishu and Kakamega charge the lowest trade licensing fees for general enterprises among 10 benchmarked regions.

For instance, the average cost for a business license in Bungoma is Sh18,000, Uasin Gishu (Sh23,800) and Kakamega (Sh25,618).

Read: Nairobi traders without permits to pay hefty fee

In contrast, city counties have the highest business license costs making rural areas the better location for traders from a cost perspective. The average cost of a business license in Nairobi county, for instance, stands at Sh92,250, followed by Mombasa (Sh75,385), Kisumu (Sh45,000) and Nakuru (Sh31,023). The average cost of a business permit in Nairobi is more than five times over that in Bungoma County.

 City business license costs are seen as relatively costlier given their offer for higher quality services including road infrastructure and water.

“The cost of licensing a business is high in cities given the demand for high-quality services such as water and infrastructure, which are catered for by county governments. Even in rural counties, there are zoning regulations where businesses in high-traffic areas are required to part with higher licensing costs,” noted Viffa Consult Director Victor Agolla.

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A subsequent analysis of county Finance Acts reveals a sharp contrast in licensing costs across devolved units. For instance, a business permit for small trader shop premises of less than 30 square meters ranges between Sh4,000 and Sh2,500 depending on the location of the business.

The same business establishment attracts a flat charge of Sh5,000 in Nairobi while shops larger than 50 square meters attract licensing fees as high as Sh25,000.

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