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KAM seeks audit of regulations to end double taxation

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Kenya Association of Manufacturers vice chairman Rajan Shah. PHOTO | SALATON NJAU | NMG

Manufacturers want business-related regulations audited to end duplication and unnecessary levies that discourage investments across the country.

Kenya Association of Manufacturers (KAM) vice chairman Rajan Shah said while regulations should create a predictable environment for businesses to thrive, the current set was predatory, allowing the national and the county governments to tax manufacturers at source as well as during delivery of goods across counties.

“We pay levies within host counties while our distributors also pay levies to their host county governments, but ideally we should not be charged a levy for distribution and garbage disposal every time our goods enter a county,” said Mr Shah.

Counties have in the past seven years been struggling to raise their own revenue to supplement allocations from the exchequer. Manufacturers have been easy targets, with counties forcing them to pay a several fees to operate in their territories.

To promote competitiveness and a level playing field, KAM has been calling for establishment of a high level government approval process for any regulatory agency(county governments and regulatory agencies) imposing corrective measures touching on businesses.

Besides the double taxation, Mr Shah also said the blanket one percent turnover tax introduced this year by the National Treasury should be differentiated between loss-making firms and those failing to declare profits due to heavy investments. He said the indiscriminate taxation will hurt those who are investing in the growth of their businesses.

The industrialists say counties must be discouraged from introducing no-service linked fees, charges and levies.