Market traders and business associations have opposed the proposed Finance Bill 2021, saying some of the many new charges are punitive and unnecessary.

City Hall has never met its revenue target and is desperate to raise funds.

They claimed on Tuesday that most charges will be a burden to  taxpayers already overtaxed and struggling to recover from the effects of Covid-19. They want a number of proposed levies dropped.

The Nairobi City County Finance Bill 2021 proposes a raft of new taxes, notably a first-time tax on offloading fresh produce in markets. This outraged traders.

Residents spoke during a public forum seeking their views. It was attended by the assembly budget committee, county executive, Nairobi Metropolitan Services and the Kenya Revenue Authority.

Traders from different markets complained of paying multiple taxes, despite getting poor or no services from City Hall. They cited many problems, including uncollected garbage, lack of lavatories, water and security, and harassment by inspectorate officers.

Westlands Market traders said City Hall’s attempt to increase the charges for stall traders from Sh500 to Sh2,000 per month is way beyond their means and could lead to  unemployment.

“The county gave us a target of Sh9.5 million to be raised annually but we lack water, security, cleaning staff and latrines, yet the government wants to raise fees," market representative Martin Ndung'u said.

The proposed taxes are aimed at helping achieve the Sh19.8 billion own-source revenue target for the financial year ending June 30 this year.

The traders further criticised the county for wanting to increase charges in the recently ‘refurbished' market, yet it is incomplete and lacks parking, lifts, CCTV and cleaning staff.

Wakulima Market traders also faulted the county for the multiple access fees charged for fresh produce sold. The monthly target is Sh20 million.

The Bill proposes a daily market access fee of Sh50, while offloading from a pickup will cost Sh100 and from a lorry Sh500.

For potatoes, the proposed charges are Sh50 per kg, while avocados, tomatoes, groundnuts and thorn melon will be charged Sh50 to Sh1,500 per kilogram, depending on the size of transport vehicle.

Wakulima traders also complained the multiple new markets have brought stiff competition and attaining the revenue target is almost impossible.

“We pay three types of access fees: at the lorry carrying the goods, at the gate of the market and at the selling point of the products and yet we are no longer the monopoly market. The charges should be reduced so  traders can earn income and not drain their money in levies," traders' representative Tom Munyao said.

Traders from City Market complained of the increasing number of hawkers around markets, yet they pay no fees to the county and KRA and kanjos are not on their necks.

Amos Thuo representing Burma Market traders pleaded with the county to reduce the proposed cess they pay per caucus from Sh300 to Sh150

Fish sellers from Gikomba market want the county to scrap the proposed Sh30 per box charges, arguing that they already pay for food handlers and inspection certificates at the market.

The Business Association from Kariobangi South opposed the increase in land rates, saying bar owners were the hardest hit because of the operating hours, spacing and other restrictions to curb the spread of Covid-19.

“The bar business is just trying to get back on track and the increase in land rates will greatly hurt the business and may result in closure of many bars,” Joseph Oduor said.

LAND RATES

Land rates will be charged at 0.115 percent of current property value, amounting to costly levies for property owners.

Currently, they pay land rates at 25 per cent of the unimproved site value (USV) based on the 1980 valuation roll, which City Hall says has denied it additional revenue from asset appreciation.

Outdoor advertising businesses also urged the county to reconsider increasing the rates, saying their revenue will drastically decrease.

“From the Covid-19 pandemic, people shifted from outdoor advertising to digital. Increasing the fees will completely kill the business. Kindly reconsider the figure downwards for both the businesspeople and government to benefit,” Jacinta Njambi said.

KRA AND COUNTY VIEW

KRA is mandated to collect Nairobi taxes. Representatives said "local arrangements" between traders and City Hall is the biggest obstacle they face in collecting taxes.

“The conflict between KRA and traders is because of these local arrangements between traders and City Hall. As the taxman, we are guided by the law and collect what is expected from the law,” KRA officer Silverstor Okello said.

County executive for finance Allan Igambi assured traders the final fees will be "friendly" to residents and the county. He was backed by Nairobi Metropolitan Services head of revenue Daniel Karani.

PROPOSED FEES NOT FINAL

Nairobi Assembly Budget committee chairman Robert Mbatia assured stakeholders their proposals will be considered before the bill is taken to the House for a vote.

“The proposed fees are not final. As a committee we shall look at the final charges presented to us, considering the wananchi and current status of the economy," he said.

Once approved by the county assembly, the new taxes will take effect as soon as Governor Ann Kananu assents to the Bill or after 14 days of the publication of the Bill in the Kenya Gazette.

(Edited by V. Graham)