Kenya Budget Analysis 2014

Transcription

1 Kenya Budget Analysis 2014 B. C. Patel & Co. Certified Public Accountants (Kenya) P. O. Box Nairobi

2 TABLE OF CONTENTS ECONOMY 2 CUSTOMS AND EXCISE 15 VALUE ADDED TAX 16 INCOME TAX 17 MISCELLANEOUS 21 EAST AFRICA BUDGET HIGHLIGHTS 19

3 WORLD ECONOMY The world economy had a good Of course for many it was still a struggle, with the euro zone in recession for much of the year and living standards in most of the developed world still below their 2007 peak. But by the end, even the laggards had started to catch up, and for them the long nightmare of recession and its aftermath began to recede. There are two great stories in the world economy: the structural shift from the developed world towards the emerging world; and the cyclical climb out of a nasty recession. The first continued last year, but at a slightly slower pace than before. Growth in China, at 7.5 per cent, might seem breathtakingly fast, but actually it s the slowest for 23 years. Things also slowed in India, to a little below 5 per cent, again fast by our standards, but slow when compared to the past. Africa, encouragingly, grew by more than 5 per cent. The United Nations slightly lowered its forecasts for global economic growth in 2014 and 2015 citing a variety of reasons including the exceptionally cold winter in the United States, the escalating political crisis in Ukraine, and financial turbulence earlier this year. The new forecasts predict economic growth of 2.8 percent in 2014 and 3.2 percent in 2015, down from U.N. forecasts in December of 3 percent growth this year and 3.3 percent growth next year. With the IMF expecting China s economy to have grown 24 percent between 2011 and 2014 while the US is expected to expand only 7.6 percent, China s GDP (PPP) will overtake the US this year, the report concluded. But while China is expected to surpass the U.S. in purchasing power terms this year, the economy will still be about 60 percent the size of the U.S. economy at market exchange rates. Page 2

4 Commodity markets 2013 Agricultural commodity markets were characterized by price easing with less volatility than in previous years. In the base metal markets, prices showed an indecisive pace during 2013 while the precious metals market was bearish in Public Debt as % of GDP Country China 26% 22% 19% Japan 229% 236% 245% Greece 165% 170% 182% Kenya 48% 47% 45% South Africa 39% 41% 43% Nigeria 17% 14% 15% Oil, natural gas and coal exhibited different price trends during the first 10 months of Crude oil prices remained elevated due to various factors such as geopolitical risks in the Middle East and North Africa and supply disruptions in some member countries of the Organization of the Petroleum Exporting Countries (OPEC). Natural gas prices continued to record notable differences across regions. In the United States, the world s largest natural gas producer in 2012, natural gas prices recovered from their low in 2012 largely owing to improved market fundamentals. Page 3

5 AFRICA ECONOMY Africa requires major investments in three "I's": Institutions, Integration, and Infrastructure. L ately many observers have been avidly discussing the recent high rates of economic growth in Africa. Speaking in Washington earlier this year, Donald Kaberuka, the president of the African Development Bank offered some cautionary words. While the good economic news from the continent may well represent a turning point from a past characterized by hopelessness, he said, Africa nevertheless remains far from a tipping point. To reach such a threshold, Africa requires major investments in three "I's": Institutions, Integration, and Infrastructure. Even with the recent robust growth experienced over the past decade, Africa still suffers a major infrastructure deficit. Most of the countries have relatively weak institutions. And the regional integration project has been slow and marred by compliance and commitment deficits. Thus, as Kaberuka noted, although Africa has reached a turning point, progress to a tipping point is not an easy journey. Page 4

6 Africa & the European Union Lack of growth in Europe has dimmed the enthusiasm of integration and openness that formed the hallmark of the EU. The economics of the EU have changed - It started with 15 countries at the end of 2003 African Economic Growth Sub-Saharan Africa has been experiencing solid economic expansion, with real GDP growth averaging 5.5% per year over the past decade. The continent s impressive strides in sustaining growth, in stark contrast with Sub-Saharan Africa of the early 1990s, have given rise to the narrative of Africa Rising and captured the attention of global businesses. Against the backdrop of prolonged weakness in the global economy since the global financial crisis, Sub- Saharan Africa is particularly attractive, because it offers a relatively empty marketplace with untapped opportunities and an alternative growth avenue to companies struggling to expand in developed markets. Between 2008 and 2013, total consumer expenditure in Sub-Saharan Africa grew by 17.6% in real terms (above the global average growth rate of 11.3% over the same period) to reach US$908 billion... The World Bank has lowered its global economic growth projection with stable 4.7 per cent Gross domestic product growth in Sub-Saharan Africa. Medium-term prospects for the region remain favourable, with GDP growth projected to remain broadly stable at 4.7 per cent in 2014, before rising moderately to 5.1 per cent in each of 2015 and 2016, supported by firming external demand and investments in natural resources, infrastructure, and agricultural production. 4.7 % Rate at which GDP is projected to remain in and growth rates of 3.9 percent on average, to 28 countries and an average growth rate of -0.5 percent in A number of issues pertaining to the EU s relationship with Africa including trade, openness and the Economic Partnership Agreement, immigration, development assistance and peacekeeping will be under scrutiny. The EPAs, like many trade agreements under discussion, have become increasingly controversial for African countries, especially in the larger countries with industrial policies that seek to develop domestic industry by protecting local firms using trade barriers as a tool. To date no African countries have signed a full EPA, and only 14 of 45 countries have agreed to an interim one. Page 5

7 East Africa Within the EAC, the Kenyan economy is the anchor. The overall performance of the region will to a great extent depend on what happens in Kenya. Kenya's economic dominance in the region is based on a strong private sector that has evolved under relatively market-friendly policies for most of the post-independence era. As previously observed, Kenya has the largest economy amongst the members of EAC in terms of GDP. Kenya's GDP accounts for 40 percent of the region's GDP, followed by Tanzania at 28 percent, Uganda at 21 percent, Rwanda at 8 percent, and lastly Burundi at 3 percent. In terms of GDP at current market prices, Kenya's 2011 GDP stood at $34 billion, well ahead of the closest rival economy, Tanzania, with a GDP of $24 billion.. 40 % Kenya's GDP percent of the region's GDP, its followed by Tanzania at 28 percent, Uganda at 21 percent, Rwanda at 8 percent, and lastly Burundi at 3 percent Page 6

8 EAST AFRICA ECONOMY TANZANIA Hon. Saada Mkuya Salum presented the budget on 12 June The budget intends to reduce the cost of living, reduce inflation rates, improve social services, energy and irrigation infrastructure. The GDP grew by 7% as per target in This achievement is attributed to the government efforts in strengthening macroeconomic stability and good governance. The economy is projected to grow by around 7% in 2014 and 2015, driven by transport, communications, manufacturing, agriculture and supported by public investment in infrastructure. Annual inflation has continued to decline form 9.4% in April 2013 to 6.3% in April 2014 against targeted rate of 6% in June The decline was achieved due to strong macro economic policy, good climate conditions which lead to increase in food production, provision of farm inputs, subsidies, and availability of electricity. Inflation is projected to decline further to 5% by June Percentage the economy is expected to grow in 2014 and Preparation of the new constitution is in its final stages. The issues that remain high on the agenda include: the structure of the union between mainland Tanzania and Zanzibar, the presidential powers, natural resources management and political reforms. The government intends to raise Tshs 19.8T from both domestic and foreign sources, of which 13.4T allocated to recurrent expenditure and 6.4T allocated to development expenditure. The budget for 2014/2015 has proposed removal of powers of the Minister of Finance to grant tax exemption, which was one of the key challenges faced in terms of revenue collection. Areas proposed include exemption of excise duty on petroleum products, granting fuel levy exemption amongst others. Following key amendments are proposed to the Income Tax Act: Imposed 15% final withholding tax on Board of Director's fees. Remove corporate tax exemption to companies for income derived from gaming. Adjust PAYE threshold from 13% to 12% intended to provide relief of tax burden to employees. Page 7

9 EAST AFRICA ECONOMY... UGANDA The Budget was read by finance minister Maria Kiwanuka on 12 June Theme - Maintaining the momentum - Infrastructure investment for Growth and Social Economic Transformation. Uganda's economy continued to grow through financial year 2013/14 albeit more modestly than the 6.2% that was projected in year 2012/13. Agriculture, production and productivity sector contributed to 21% of the GDP, which also employs 70% of the Uganda's labour force. The stock of foreign exchange reserves improved slightly from US$ 2.9 billion to US$ 3 billion, equivalent to 4.2 months of future imports of goods and services. This is still below the government's medium term objective of maintaining reserves of 5 months import cover to act as buffer against external shocks. The capital market registered a record turnover of Ushs 198 billion up from Ushs 31 billion recorded in 2012 (6 fold increase). While average commercial bank lending rates declined from 24.2% to 20% during the year. GDP is projected to grow at 6.1% in 2014 and to restore the real GDP growth to 7% per annum in the medium term. Inflation remained low and dropped to 5.4% by May Annual core inflation declined to 3.3% as of end - May Uganda noted relatively stable exchange rates during the year. Balance of payment continued to be affected by the persistent current account deficit due to large trade deficit amounting to US$ 2.46 billion, equivalent to 14% of GDP. In the current year budget - Government intends to raise Ushs 15T, of which domestic sources will account for 12.3T and the balance of 2.7T from external sources (18.2% of the total budget sources). Macro economic objectives remained the same as prior year with an additional objective being - positioning Uganda in the context of EAC integration to ensure competitiveness.. Page 8

10 UGANDA Following key amendments are proposed to the Value Added Tax (VAT): Termination of exemptions on the following supplies WEF 1st July 2014: Supply of new computers, desktop, printers, computer parts & accessories and computer software licenses. Supply of hotel accommodation in tourist lodges and hotels outside Kampala District. Supply of LPG. Supply of feeds for Poultry and Livestock. Supply of Agriculture and Dairy Machinery. Supply of Packaging Materials to the Diary and Milling Industries. Supply of Salt. Supply of Insurance services except medical and life. Supply of specialized Vehicles, Plant and Machinery services and civil works related to roads and bridges construction, Agriculture, Water, Education and Health. Termination of zero rated supplies WEF 1st July 2014: Supply of printing services for Educational materials. Supply of cereals, grown, milled or produced in Uganda. Supply of processed milk and milk products. Supply of Machinery and Tools for Agriculture. Supply of Seeds, Fertilizers, Pesticides and Hoes.... Following key amendments are proposed to the Taxes: Capital Gains Tax on sale of Commercial Property. Imposition of 15% tax on sports and pool betting winnings and designation of Gambling Houses to withhold the tax. Termination of exemption on Interest income on Agricultural loans. Termination of exemption on Income derived from Educational Institutions. Following key amendments are proposed to the Excise duties: Increase of Excise duty of 50 Ushs on Petrol and Diesel. Reinstate Excise duty of 200 Ushs on Kerosene. Increase Excise duty on Sugar from 25 Ushs to 50 Ushs. Introduction of 10% Excise duty on Mobile money withdrawn fees. Introduction of 10% Excise duty on Bank charges and money transfer fees. Page 9

11 KENYA ECONOMY Spending more wisely rather than spending more will be key As per the forecasts, Kenya s GDP will expand by five per cent this year but slow to 4.7 per cent next year and 4 per cent in Key economic drivers such as tourism, agriculture including tea and maize Kenya s staple food crop are doing badly as a result of terrorism threats and inadequate rainfall. Kenya must tighten its fiscal policy to bridge the widening budget deficit that now exceeds three per cent of its Gross Domestic Product. Tightening the fiscal policy would mean adopting austerity measures that could see reduction in State spending. Radical moves such as reviewing some taxes downwards would also be in the mix to leave the population with more money to spend.... Increased public spending has seen Kenya's budget balloon year-on-year to Sh1.8 trillion in the 2014/15 fiscal year. Revenue collection is estimated at between Sh700 million and Sh800 million, meaning the country will have to raise almost Sh1.1 trillion in deficit. Spending more wisely rather than spending more will be key. Page 10

12 KENYA ECONOMY... Kenya GDP change of base GDP estimates for East Africa's biggest economy are expected to jump almost by 20% when a government-led statistical review reports will be published in September. The previous base for calculations of Kenya's GDP was prior to the telecoms boom and the emergence of mobile money transfers. The new GDP figure will be based on data from 2009 onward. Even a comparatively small rise could see Kenya's annual per capita income surpass the World Bank's benchmark for middle-income countries of $1,036, up from the current $943. Nigeria revised its GDP upwards by 89% on April 6th, based on a broader survey of economic activity including young sectors such as telecoms, a process known as "re-basing". A similar exercise in Ghana in 2010 found the economy to be 60% bigger than previously recorded. While Kenya s impending re-base of the economy could hand it a middle-income status, which could boost investor confidence, the revision does not lessen current concerns regarding growth bottlenecks, weak governance and macroeconomic imbalances.. Kenya Debt Kenya s gross public debt has more than doubled in the last five years to Sh2.1 trillion or 51.1 per cent of GDP as at March 2014 compared to Sh1.06 trillion (46.4 per cent of GDP) in June Kenya s increased uptake of debt is approaching worrying levels, citing the difficulties that last month forced the Treasury to reschedule payment of a $600 million (Sh52.8 billion) syndicated loan taken in It s time to ask ourselves if the current debt levels are sustainable given that our servicing obligations are growing fast. What should the government do to spur growth? The answer is simple. It is not more about incentives. Just reduce the hurdles to doing business. Provide decent infrastructure, have stability of policies, encourage competition and bring more transparency and accountability to reduce corruption. The rest will take itself. Page 11

13 Power generation Kenya s current effective installed (grid connected) electricity capacity is 1,765 MW. Electricity supply is predominantly sourced from hydro and fossil fuel (thermal) sources. This generation energy mix comprises 52.1% from hydro, 32.5% from fossil fuels, 13.2% from geothermal, 1.8% from biogas cogeneration and 0.4% from wind, respectively. Current electricity demand is 1,354 MW and is projected to grow to about 2,500 MW by 2015 and 15,000 MW by To meet this demand, Kenya s installed capacity should increase gradually to 19,200 MW by Some of the challenges facing Kenya s energy sector include low investment in the power sector by private investors, high cost of rural electrification, limited distribution capacity, limited capacity during peak demand, grid-system losses and weaknesses limited reach in rural areas, over-reliance on hydro power which constitutes about per cent of the total electrical power hence this has caused the country to power rationing in times of drought, resulting in the use of very expensive energy power generation Percentage of energy produced from Hydro. Page 12

14 Eurobond 40% The population under the age of 15 African countries have taken advantage of the growing appetite for emerging-market debt in recent years to tap the international capital markets. The Government of Kenya is preparing to sell between US$ 1.5 billion to US$ 2 billion in Eurobonds. The government intends to use the proceeds to pay off a syndicated loan of US$ 600 million and for general budgetary purposes including the funding of infrastructure projects. Several Sub-Saharan countries including Ghana, Nigeria, Rwanda, Senegal and Zambia have issued Eurobond in recent years. Future Outlook Despite this immediate political challenge the country faces, its medium to long-term outlook is good. With over 40% of the population under the age of 15, Kenya stands to benefit from a significant demographic dividend, provided that sufficient jobs can be found when this population bulge enters the workforce. The Kenya Vision 2030 development plan identifies tourism, agriculture, wholesale and retail trade, manufacturing, IT services and financial services as strategic sectors for development. The plan also outlines key infrastructure projects including reinforcement of the country s electrical system, port improvements, expansion of the road network, airport rehabilitation and railway construction. Recent discoveries, including the identification of a major new water aquifer as well as potentially significant oil reserves, also promise to drive economic development. Conclusion: In conclusion, Kenya remains a vibrant and promising economy in East Africa, one that is resilient and has the ability to bounce back after political shocks such as the election violence and the Westgate Mall terrorist attack in Nairobi. There are challenges that the country still needs to address, above all poverty, inequality, and access to health services. The recent discovery of resources such as oil, base titanium, coal, and underground water, augur well for the country's future economic performance. Page 13

15 KENYA BUDGET HIGHLIGHTS Government has made positive strides in terms of improving budget transparency in timely dissemination of Programme Based Budget (PBB) Estimates for 2014/15 via internet, and provision of more details with regard to programmes and their objectives as well as disaggregated information on sub-programmes linked to outputs, indicators and targets. Revenue For Budget 2014/15, total revenue is projected to grow by 18% to Ksh 1,212.9 billion up from Ksh 1,027.2 billion in 2013/14, on the back of recent fiscal development. This development includes the new VAT law that is anticipated to increase revenue collection through reduced administration costs and enhanced compliance, as well as through other ongoing tax reforms including automation of the system. Expenditure Overall spending is estimated to nominally increase by 8% from Kshs 1.64 trillion in 2013/14 to Ksh 1.77 trillion in 2014/15. Expected transfers to county government comprise 13%, similar proportion to the one in 2013/14. Over the last five years, compensation to employees has accounted for on average 40% of recurrent expenditure. Out of a total expenditure outlay of Ksh 1.77 trillion in 2014/15, the national government budget is estimated at Ksh 1.54 trillion. The sectors taking the lion s share of the national government budget are education sector, 20%, Energy, Infrastructure and ICT, 16.6%, Public Administration and International relations 12.6%. Agriculture Agriculture remains the bedrock of the Kenyan economy. The sector contributes about 25% of GDP and about 75% of industrial raw inputs. Due to inadequate rainfall, agricultural performance and growth rate declined from 4.2% in 2012 to 2.9% in In 2014/2015 budget, the government objectives are largely similar to the previous year s, namely: to ensure food security, improve productivity and commercialize Kenyan agriculture with irrigation still the top priority. Land reforms As Kenya is a predominantly agro-based economy, land is arguably one of the important natural resources. In this respect, Kenya has adopted critical land reforms aimed at improving land governance and reducing land related conflicts. However, the implementation of land reforms faces risks due to lack of clarity of roles between the Ministry of Lands, Housing and Urban Development and the National Land Commission, and the ensuing confusion thereof. Page 14

16 CUSTOMS & EXCISE East Africa Customs Management Act Import duty on steel products Import duty on majority steel products are proposed to increase from 0% to 10% for basic raw material and from 10% to 25% for intermediary products for a period of one year up to 30 June This is primarily to support the local industry. Some of the HS Codes where duty is expected to increase: Effective: 01 July Paper & paper products Reduction in import duty from 25% to 10%. The EAC combined consumes more paper than the total paper manufactured in the region. Effective: 01 July 2014 Security Bonds Importers of refined sugar under gazetted manufacturers and wheat millers will no longer be required to issue security bonds. Currently the importers execute bonds in favour of Kenya Revenue Authority equivalent to taxes payable. Solar & wind energy Import duty is removed on machinery, spares and inputs for direct and exclusive use in development and generation of solar and wind energy. Effective: 01 July 2014 Page 15

17 VALUE ADDED TAX (VAT) No changes are proposed in the Finance Bill VAT regulations clarifying and interpreting key areas of the act is awaited. Page 16

18 INCOME TAX Effective : 1st January 2015 Permanent Establishment (PE) The definition of PE is expanded to incorporate place of management, branch, mine, oil and gas well, quarry and or extraction of natural resources. The definition is in line with OECD guideline. Income from Oil & Gas, Natural resources Net gains derived from sale or disposal of interest from mining rights or interest in petroleum agreement or natural resources will be charged at normal income tax rate. In the past, tax was charged on the value of consideration. Now this changed from consideration to net gains. This income was subject to withholding tax. Now the income will be subject to the normal tax rates as follows (no more withholding tax will be applicable): % Interest Taxable value Up to 20% No tax >20% to 50% Formula (proportion to interest acquired) >50% Full amount of net gains Page 17

19 INCOME TAX... Natural Resources New definition of natural resources is introduced. The proposed amendment expands the tax base where a consideration is paid to take minerals and living or non-living resources from land or sea. We have yet to see whether capturing live fish from water falls under the new definition. Income from natural resource will be subject to withholding tax; same rate as royalty. For resident person 5% For non-resident person 20% * * Different rates apply where there is double taxation treaty is signed by Kenya. Transfer Pricing Rules The definition of Permanent Establishment is expanded to include transactions between resident and non-resident company through permanent establishment in Kenya. In the past, TP rules were applicable to direct transactions between a resident and non-resident person. This is again in line with international best practices. Double Taxation Treaty Tax payers who enjoy exemption or lower tax rates in Kenya will no longer be allowed to enjoy double tax treaty rates unless the ownership of the company is at least 50% owned by individuals resident of one of the two treaty countries or is owned by a listed company. This is important particularly when the lower tax rates enjoyed in Kenya and in addition double tax treaty rates are availed by outsiders (by people who are not resident of either Kenya or treaty country). The amendment is meant to address abuse of DTA. Record keeping The Finance Bill clarified that every person having taxable income (except employment income) is required to keep all records of income, expenses, receipt, payments and other relevant documents. Number of times, it is observed that non-profit making institutes do not keep records under the pre-text that they do not carry out business. Now it is clarified. Page 18

20 Information on change in particulars Taxpayers are now required to notify the Commissioner of KRA within 30 days of occurrence of change in particulars, like: Place of business Trading name Contact address Change in more than 10% shareholding of issued capital Nominee shareholding disclose the beneficial owners Trust full details of settlor and beneficiaries Partnership identity of all partners Close of business- all information of liquidation Sale of business all information of new ownership Income of County Government Income of local authority is tax exempt. The Finance Bill amended this word local authority with the word county government in line with new constitution of Kenya. Provisional Tax Provisional return is abolished some time back in 1992 and replaced by self-assessment law. All provisions relating to provisional return, tax and penalties are deleted from the Act. Wear & Tear Allowance Proposal is made to provide wear and tear allowance of 12.5% on petroleum pipeline. Investment Deduction Investment deduction on filming equipment was proposed in 2009 budget but it was not captured correctly. Now the proposal is made to incorporate filming equipment for investment deductions. Mining Operations Tax deduction provisions relating to mining industries were governed by part III of second schedule of the Act. Now this is deleted and will be governed by new schedule nine of the Act. Page 19

21 Vacation trips Effective: 13 June 2014 Expenditure on vacation trips to destinations in Kenya paid by the employer on behalf of an employee will no longer will be considered as benefit for a period of one year from 1 July 2014 to 30 June The employer will be allowed to deduct such expenditure as business expense. This is in line with policy on promotion of local tourism. New 9th schedule that overrides the old 9th schedule of the income tax contains; 1. The taxation of subcontractors, who are important players in the mining and petroleum sector. 2. The corporate and withholding tax rates that will apply to the sector, as well as treatment on the profit oil that the Government is entitled to, where the petroleum agreement state that taxes are payable by the Government. These provisions are meant to provide certainty on the attributable to the petroleum companies and Government Tax treatment in case of farming out. 4. Treatment of expenditure used for decommissioning of petroleum site which has been abandoned or decommissioned. 5. Treatment of the various expenditure relating to exploration and development expenditure before commencement of the commercial operations in the petroleum sector. 6. The provision for hedging transactions entered into by a mining licensee and contractors and is meant to manage price risk. 7. The provision for thin capitalization where loan to equity ratio is 2:1 as opposed to the normal rate which is 3:1. The proposed measures are intended to reform the taxation of the mining and petroleum sectors. Effective Date: 1 st January 2015 Page 20

22 MISCELLANEOUS NSSF Act 2013: Proposals are made to the New NSSF Act 2013 to remove the inconsistencies it has with the RBA Act: Change the deadline of monthly payment to the fund by employer to the 10 th day of the following month. NSSF Account to be submitted to the Auditor General within a period of three months not six months as earlier. Definition of Employer The definition of employer is changed to drop government. This means, the employees working with Government of Kenya will no longer be required to subscribe to the new NSSF Act. Competition Act 2010: Proposals have been made to facilitate low regulatory and transaction costs and ensure predictability and transparency in its enforcement. Insurance: Changing regulations and legislation in East African countries Uganda, Kenya, Tanzania and Rwanda require insurers to separate their long-term and short-term insurance businesses. Insurance companies offering both as a composite company under the same management, are required to separate operations in line with international practice. Page 21

23 Regulatory framework Following new Bills will be published in the coming year. 1 Excise Duty Bill Stand alone Act is required since Excise duty is a local tax. 2 VAT Regulations Clarification and interpretation of key areas of VAT Act. 3 Income Tax The existing Act is very old and outdated with current business practices. 4 Tax Procedure Bill To incorporate uniform tax procedures for major tax laws mainly VAT, Excise and Income Tax. 5 Insurance Bill The existing Act is very old and outdated with current business practices. 6 Financial Services Authority Bill For regulatory and supervisory aspects of financial services sub-sector 7 Central Bank of Kenya Bill To keep pace with the best practices in the world 8 Inland Revenue Agency Bill To enhance revenue administration capacity 9 Customs and Border Services Bill Enhance capacity of tax administration Page 22

24 The analysis/views in this booklet do not purport to be and should not be treated as legal opinion. Nothing contained herein can substitute appropriate legal opinion in fact specific situations that affect you or your organization. Prepared by B. C. Patel & Co., for client service and internal use only. This document summarizes the indirect and direct tax proposals of the Kenya Budget read on 12 June Expert guidance may be sought before acting upon the proposals. B. C. PATEL & CO. Certified Public Accountants (K) P. O. Box GPO Nairobi I Tel: / / I Fax: audit@resources.co.ke I Website: