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{
    "id": 1254207,
    "url": "https://info.mzalendo.com/api/v0.1/hansard/entries/1254207/?format=api",
    "text_counter": 158,
    "type": "speech",
    "speaker_name": "Prof. Njuguna Ndung’u",
    "speaker_title": "The Cabinet Secretary, National Treasury and Economic Planning",
    "speaker": null,
    "content": "consider and fast-track this Bill to unlock revenue potential to the county governments from property taxation as envisaged in Article 203(3). Hon. Speaker, let me now turn to sharing of mineral royalty revenues. The Mining Act, 2016 assigns 70 per cent of the mineral royalties collected from mining companies to the national Government, 20 per cent to county governments and 10 per cent to communities. Since 2016, county governments and communities have not received their share of these royalties. To address this matter, I have submitted a framework for sharing Ksh2.9 billion shillings among 32 county governments for mineral royalties outstanding as at 30th June 2022 for consideration and approval by Parliament. During the Intergovernmental Budget and Economic Council (IBEC)’s 17th Ordinary Session held on 31st May 2022, the IBEC considered and adopted a report and a framework for sharing of funds arising from contravention of county government legislation. In the next financial year, the National Treasury has proposed Ksh108 million to be shared among the beneficiary county governments. Enhancement of county governments has its own challenges. One such challenge is multiplicity of fees and charges imposed by county governments that increase the cost of doing business and negatively impacts on our competitiveness as a country. Some county governments have imposed charges in a way that prejudices national economic policies, economic activities across county boundaries, or the national mobility of goods, services, capital or labour. As a result, the Ministry of National Treasury and Economic Planning has received many complaints from ministries, departments, State agencies, and the private sector relating to the un-coordinated manner in which counties are imposing multiple fees and charges. Some neighbouring countries have complained that some of the charges imposed by county governments are against the East African Community (EAC) Customs Management Act and the EAC Common Market Protocol and may result in retaliatory measures and trade disruptions between Kenya and other partner States in the EAC. To address those issues, the Ministry of National Treasury and Economic Planning has re-submitted the County Governments (Revenue Raising Process) Bill, 2023 to Parliament for consideration and enactment. I urge this House to expedite the enactment of this Bill to promote our country's competitiveness in doing business and open up the country for investment. Hon. Speaker, I will now turn to taxation measures focusing on tax policy measures aimed at generating revenue to finance the Financial Year 2023/2024 Budget. I will begin by highlighting key measures on custom duty as agreed by the ministers responsible for finance and economic affairs in the EAC during the pre-budget consultations meeting held in Arusha in May 2023. During the EAC Pre-Budget Consultations Meeting, the ministers noted the significant contribution of the manufacturing sector to job creation and economic growth in the region. Therefore, the ministers agreed on measures to prevent the proliferation of cheap imports into the region to protect local manufacturers from unfair competition and enable them to access raw materials and inputs at affordable prices. The agreed custom measures shall become effective from 1st July 2023. One of the success stories of the EAC is the establishment of the EAC Customs Union as a single customs territory. To streamline the importation of goods into the customs territory, the EAC completed the comprehensive review of the Common External Tariff. This has been under implementation since 1st July 2022. The revised Tariff has a four-tariff band structure compared with the earlier three-tariff band structure. In the new structure, raw materials/inputs and capital goods are imported duty-free; intermediate goods are imported at the rate of 10 per cent, while finished goods, which are not available in the region, are imported at 25 per cent. Finally, all finished goods available in the region in sufficient quantities attract a Common External Tariff rate of 35 per cent. The revised tariff bands are meant to cater for goods with long value chains which require differentiated rates to promote investments. The electronic version of the Official Hansard Report is for information purposesonly. A certified version of this Report can be obtained from the Hansard Editor."
}