News Column

CRA Provides Model for Raising County Revenue

July 10, 2014

Kurgat Marindany

A revenue-raising model law in counties will cushion counties from court battles with the public over new taxation of their goods and services. Commission for Revenue Allocation chairman Micah Cheserem launched the model county revenue legislation handbook at Maasai Ostrich Farm in Kitengela on Tuesday evening.

He said in addition to the equitable share, counties are expected to raise their own revenue from taxes, fees and fines. Cheserem said taxes, fines and fees in the counties have generated mixed reactions and interpretations. Counties have no laws to guide them in raising taxes, he said.

"How can they defend their actions in courts in the absence of the laws guiding them?" Cheserem said. He said what constitutes raising revenue powers and where that power stems from has become an elusive and contentious interpretation for the two levels of government.

The handbook was put together jointly by CRA, Kenya law Reform Commission and the Council of Governors with support from the Kenya Accountable Devolution Programme of the World Bank.

It was funded by the United Kingdom'sDepartment for International Development and the Australian Department of Foreign Affairs and Trade. "We strove to provide guidelines and principles on best practice to the 47 counties on revenue-raising measures by county governments," Cheserem said.

The handbook provides three models county governments can adapt to develop laws to replace national revenue-raising legislation. It is expected to provide a framework and model for the basis of an annual Finance Bill and highlight the actions that county governments need to take to implement any law.

Speaking before the launch of the book, Cheserem raised concern over huge amounts of money spent by the county governments on foreign trips in the 2013- 14 financial year, instead of using it for development projects.

Kajiado Governor David Nkedianye said the county only spent Sh200 million in foreign trips. He said the trips were an eye-opener for him and his executive committee members.

Nkedianye said he hopes to spend some Sh1.4 billion on development this financial year once the Controller of Budget approves the Sh5.8 billion county plan that MCAs adopted and approved.

He said his government has the potential to raise more than Sh1 billion in revenue this financial year. Meanwhile, eyebrows have been raised by members of the public in Kajiado county over the manner in which the county assembly allocated itself Sh792.2 million in the 2014-15 budget.

While presenting the budget proposal last month the county assembly also proposed an increase of Sh18 million for office rent in their wards, Sh20 million for their house mortgages and Sh10 million for car loans.

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Source: AllAfrica

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