MPs back tax exempt plan for green bonds

MPs in session. FILE PHOTO | NMG

The issuance of green bonds in Kenya has received a boost after Parliament okayed a proposal to make the paper tax exempt in order to encourage higher participation in such issues.

Parliament’s Finance and Planning Committee in its report to the House on the Finance Bill 2019 said the proposal by the Green Bonds Programme Kenya will attract more people to invest in the bonds, leading to sustainable job creation and a new revenue stream for the government.

“The committee supported the proposal to exempt green bonds from withholding tax as it will encourage more people to invest in the green bond market,” said the committee in the report tabled on Tuesday.

Kenya is deemed to have a demand for climate-friendly bonds amounting to Sh91 billion in the next five to 10 years, according to research done last year by Strategic Business Advisory in partnership with the Kenya Bankers Association.

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