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Leather and Textile sectors winners in this years’ budget


By Bonface Otieno Kanyamwaya

The government has announced it’s keenness to grow the leather and textile sector by allocating Ksh 1.6 billion for the leather industrial park development and textile development.

An additional Ksh. 450 Million has been set aside to revamp of Rivertex East Africa, which was once Kenya’s textile powerhouse. This is good news for local manufacturers of textile because it focuses the growth of the sector to meet the local demand for affordable and quality clothing.

The 2017- 2018 budget has also proposed other tax measures aimed at growing local industry and enhancing our competitiveness as a country. To cushion the local manufacturers of pesticides imput the government has proposed to exempt this products from VAT, and to include I6 % tax on all pest control imported products.

Another big win for manufacturers this year, is the amendment of the excise duty act to allow refund of excise duty paid on illuminating kerosene used in the manufacture of paint and resin by registered manufacturers. This positively impact local manufacturers of paints and resin by making their products regionally competitive.

The 80% remission of excise duty on locally manufactured beer made from locally produced sorghum, millet or cassava  is also good news for local beer manufacturers and for Kenyan citizens as it reduces the uptake of dangerous illicit brews often used as alternatives to expensive brews.

In an effort to equip and build local capacity in skilled labour, the Government has proposed Ksh. 600 Million to go to Technical Vocational Education and Training Centers. This goes a long way in bridging the gap between industry needs and academia.

The proposed zero rate on bread and maize flour is good news for all citizens as it addresses the need for Government to intervene in lowering the high cost of living and increase the purchasing power for consumers.

Notably, the proposal to have Excise Goods Management Systems (EGMS) stamps embedded at a sliding scale from Ksh. 0.5 to  Ksh. 2.5 per stamp is also a welcome relief to beverage manufacturers.


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