Nairobi plans to hike business permit fees by 300pc

Nairobi business licenses
The new rates will help the county raise Sh2 billion. PHOTO/FILE
Small traders in Nairobi will dig deeper into their pockets to remain in business after the county government announced plans to raise single business permit fee by up to 300 per cent.

Informal traders such as newspaper vendors, shoe shiners and sweets sellers operating in the city centre will pay Sh10,000 annually to acquire business permits up from Sh2,500, reflecting a three-fold increase.

On the other hand, small business-owners such as chemists, dress shops and butcheries with less than four workers will acquire business permits at Sh7,000 annually from the current Sh2,500 – a 40 per cent rise.

According to the Nairobi Finance Bill, which has been published for public scrutiny, the new rates will help the county raise Sh2 billion to partly meet its Sh28.7 billion budget.

The jump in permit fees will particularly hit traders operating from the many exhibition stalls in the Kenyan capital as these dealers are already grappling with exorbitant rents being charged by their landlords.

Nairobi Trade executive Anna Othoro, however, argues that the fee is not punitive given that the traders make some good monthly turnover.

“If you divide the amount by the 12 months then the trader is only paying Sh583 per month. But look at the amount that the businesses bring in with a turnover of over Sh50,000 per month,” she said.

Nairobi wants more revenue from businesses to improve service delivery as the county struggles to lower recurrent expenditure that consumes a huge part of its income.