Nairobi to have its own revenue agency if bill sails through

City Hall could soon have its cess collection agency similar to the Kenya Revenue Authority if a new Bill pushing for establishment of such an organisation is approved by the County Assembly.

The 2019 Nairobi City County Revenue Administration Bill — which has already gone through the first reading — seeks to create the Nairobi City County Revenue Authority, which would be mandated to collect, receive and account for revenue on behalf of the county government.

Kariobangi South Ward Representative Robert Mbatia, the initiator of the Bill, said the County Revenue Authority would be headed by a County Revenue Administrator, competitively recruited by the Public Service Board.

Mr Mbatia said the authority would register and maintain revenue payers in the county.

The revenue payers would be assigned a revenue identification number while the authority would adopt an integrated collection system for the purposes of ensuring effective and efficient administration of public money.

“We want to seal loopholes and make revenue collection serious. The bill will ensure all the inadequacies and capacity challenges that have led to low revenue collection are solved,” Mr Mbatia said.

The Budget and Appropriations Committee chairman added that all the money received by revenue collectors, officers and staff in the authority shall be deposited into the County Revenue Fund.

City Hall already has such an account at Co-operative Bank where all its revenue is sent before being taken to the Central Bank.

The Kariobangi South representative said the authority would assess revenue payable to the county where applicable, advising the finance executive on all matters relating to the administration and enforcement of revenue laws.

“It would also ensure optimum compliance is achieved,” Mr Ngatia said.

The agency would, however, work under the directions of the finance executive to achieve its targets, he said.

“The County Revenue Administrator shall hold office for five years and will be eligible for reappointment for a further and final term of five years,” Mr Ngatia said.

Utawala Ward Rep and Budget Committee vice-chairman Patrick Karani said only through adoption of the new law would the devolved government reverse the trend of dwindling collections “which has seen Nairobi County struggle to meet its revenue targets”.

“In the current financial year, there is a deficit of Sh7 billion and we could have a deficit of Sh5 billion in the next fiscal year. This naturally means we should be working on how to reduce the deficit,” Mr Karani said.

According to the bill, there shall be a board of directors, headed by a non-executive chairperson appointed by the governor with the approval of the County Assembly, which shall serve as governing council of the revenue authority.

The board would also consist of a finance chief officer, four other people appointed by the executive, a member from special interest groups and a county revenue administrator who shall be an ex-officio member.

The board members’ term shall be three years but subject to renewal once.

To ensure the authority is held accountable and meets its targets, the bill proposes that it gives quarterly reports on its operations and annual reports on collection of revenue and other matters related to that.

The bill may, however, face approval challenges as it proposes the closure of the existing revenue office as well as giving the executive the liberty to absorb the current revenue officers into the authority.
The officers have expressed concerns over their jobs.

“There should be no course for alarm as no one will be rendered jobless. The officers will be given priority as our intention is to raise revenue collection and not to create unemployment,” Mr Mbatia said.

The bill is expected to go through the second reading once the assembly resumes its sittings early next month.