Revenue shortfall due to the coronavirus pandemic has denied counties Sh3.5 billion in equitable share in the year ended June, highlighting the adverse effects of the disease on the devolved units’ funding.
Treasury Secretary Ukur Yatani said that the mix of tax measures to cushion Kenyans from the effects of the disease and restrictions to curb its spread hurt collections in the last quarter of the 2019/20 period leading to the cash crunch.
Revenue shortfall due to the coronavirus pandemic has denied counties Sh3.5 billion in equitable share in the year ended June, highlighting the adverse effects of the disease on the devolved units’ funding.
Treasury Secretary Ukur Yatani said that the mix of tax measures to cushion Kenyans from the effects of the disease and restrictions to curb its spread hurt collections in the last quarter of the 2019/20 period leading to the cash crunch.
Mr Yatani added that budget reviews that freed up Sh53.7 billion to fight the disease, cushion households and businesses reeling from the economic meltdown also occasioned cuts for county funds.
Counties were allocated Sh316. 5 billion in equitable share but had by last month received Sh313 billion and are yet to receive the balances three months into the new financial year.
The cash delays have seen the devolved units struggle to pay salaries and provide basic services like health and carry out roads construction, highlighting the effects of the cash transfer hitches from Treasury.
“Incomplete disbursement of FY 2019/20 equitable revenue share to the counties was due to unprecedented shortfalls in ordinary revenue experienced during the last quarter of the financial year as a result of the Covid-19 pandemic,” Mr Yatani said.
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