Nairobi county has failed to meet its set revenue target for the first quarter of 2018/19 financial year by Sh1.3 billion.
According to the quarterly report seen by the Star, the county collected revenue worth Sh2.6 billion against the set target of Sh3.9 billion between July and October this year.
County Assembly Budget and Appropriations committee chairman Robert Mbatia yesterday said the shortfall was as a result of the failure to ensure transparency in revenue collection.
"We need to rethink about a revenue enforcement mechanism because we have circumstances where business people do not renew their licenses and fail to pay for them. This results in a decline of county collection," Mbatia said.
The county collects Sh1.7 billion from local revenue sources such as parking fees, rates, single business permits, building permits, billboard advertisements and taxes from markets such as Wakulima market.
Other sources of revenue include fire inspection certificates, food handlers’ certificates, house rents, construction site boards, and regulation of buildings among others.
The Budget Committee chairman said there is a need to come up with policies aimed at motivating business people especially small-scale traders who are normally reluctant to pay taxes.
"With some new policies, residents will realise the value of timely payments to the county," Mbatia said.
He also proposed a census to be carried out seeking to establish the total number of registered businesses in the city to ensure each trader pays tax.
This follows the committee's recent findings, which showed there are a total of 150,000 traders with Single Business Permits (SBP) in the city, a number which the MCAs have disapproved.
"We first need to record all the businesses in order to optimise their potential. We shall continue to lose revenue if these businesses continue to operate without paying for their permits," Mbatia said.
The Controller of Budget Agnes Odhiambo and National Treasury cabinet secretary Henry Rotich have in the past highlighted the failure by the 47 county governments to meet their local revenue targets.
Odhiambo, in her first quarter report for the 2017/18 financial year revealed that Nairobi recorded a revenue decrease of 27 per cent from total income collected totaling to Sh1.49 billion.
The county had recorded revenue of Sh2.04 billion during the same period in the 2016/17 financial year.