(3 Minutes Read) (Global)
The demands by the US come amid growing concern by traders and citizens about random regulatory changes, including tax and trade policies and financial regulations that affect business and livelihoods.
The US is demanding that Kenya grant traders and the public a bigger say in regulatory changes to safeguard their rights. The set of rights suggested by the US include accommodating their views and granting them sufficient time to comply.
The demands by the US come amid growing concern by traders and citizens about random regulatory changes, including tax and trade policies and financial regulations that affect business and livelihoods.
In a newly published text in the ongoing negotiations for new trade and financing deals with President William Ruto’s government, the US wants transparent and realistic public participation in regulatory changes.
The US Government said that the proposed text stems from the United States’ recognition that early information about planned regulatory actions through the use of regulatory agendas allows interested persons to engage with regulatory authorities, thus providing more time to prepare to comply.
The US further urged Kenya to upload all proposed regulatory changes on a common online platform for easy access across the globe.
The text also includes advisories like publishing draft regulations and allowing adequate time for comments. Public consultations on draft regulatory measures can contribute to better regulations, as regulators do not always have complete information to anticipate the impact and consequences of regulations, it further said.
The Kenyan government has come under pressure over a raft of recent tax changes through the Finance Act 2023, including the doubling of value-added tax on petroleum products and a new housing development levy, charged at 1.5 percent of gross salaries and matched by employers despite public protest.
Apart from the housing levy that has generated a lot of debate, including a protracted court case, several taxation reviews have left Kenyans worse off, partly with the pace at which they have been proposed and introduced. Soon, Kenyans will contribute more to public insurance whose premiums will rise several times at a time when salaries have remained stagnant.
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Businesses have also not been spared regulatory hits, including intermittent raises on export tariffs or bans on exports or imports of items such as maize, macadamia, and avocado. For instance, in October 2023, Kenya’s domestic agricultural production exceeded projections. In response, the Kenyan government issued an import ban on maize and wheat imports and stopped issuing import permits.
