BUDGET DAY

Big week ahead as East Africa prepares budgets

Budget and Appropriations Committee has approved Sh2.73 trillion spending.

In Summary

• The parliamentary committee approved Sh1.8 trillion for recurrent spending, Sh584.9 billion for development and Sh316.5 billion for the devolved units.

• The country hopes to collect Sh1.61 trillion in ordinary revenue to finance the budget with domestic and foreign borrowing expected to bridge the deficit.  

Members of Parliament during the opening of the 11th Parliament
Members of Parliament during the opening of the 11th Parliament
Image: /FILE

The governments of Kenya, Rwanda, Tanzania and Uganda are making final adjustments to their budget plans, which will be unveiled  Thursday.

In Kenya, already the Budget and Appropriations Committee a Parliamentary committee has approved Sh2.73 trillion spending for the national and county governments in the 2020-21 fiscal year starting July 1.

The parliamentary committee approved Sh1.8 trillion for recurrent spending, Sh584.9 billion for development and Sh316.5 billion for the devolved units.

 

The country hopes to collect Sh1.61 trillion in ordinary revenue to finance the budget with domestic and foreign borrowing expected to bridge the deficit.   

The East African states are expected to focus on reducing taxes to stimulate their economies.

The Covid-19 pandemic has pushed economies in the region into freefall and the private sector is hoping governments will come up with measures to revive growth.

Businesses want a range of taxes cut, especially duties on imports of raw materials and petroleum products.

Uganda plans to suspend corporation tax payments for April to June, while taxes on manufacturing, horticulture, and tourism will be deferred to September.

Kenya has reduced the pay-as-you-earn tax on wages and the East African Business Council is calling for this to be introduced in all countries in the region.