Experts have decried what they see as discrimination in tax incentives for plastic recycling plants, saying older companies are excluded.
The Finance Bill, 2019 has proposed to lower corporate tax for the first five years to 15 percent for any investor operating a plastic recycling plant.
KPMG, however notes the wording in the bill means that the incentive only applies to new entrants, thus does not apply across the board.
“Our proposal is that for the sake of equity this should be amended to allow every taxpayer in the industry enjoy the 15 percent rate by changing this to the effective date, say from 1st January going forwards,” KPMG Partner Peter Kinuthia told Parliament.
He noted the incentive is a step in the right direction in waste management, and would achieve much if it benefited all.
The government seeks to introduce the incentives to encourage more investment to explore the economic opportunities within the plastics recycling value chain.
In April, Chinese plastic bottle recycling company Weeco said it had pumped Sh600 million to setup its second Kenya factory in Mombasa amid plans to expand its operations outside Nairobi.
The firm will collect and recycle plastic bottles into pellets which will later be converted into fibre and garments for sale in Kenya and other markets such as China, the US and Europe.
The Kenya Association of Manufacturers’ Kenya Plastics Action Plan is set for launch this month and provides an opportunity for the private sector to establish a collective position and propose solutions on plastic pollution.
The lobby says plan will be “an essential strategic avenue” that if fully implemented would significantly build Kenya’s plastics recycling sector.
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