Nairobi Governor Johnson Sakaja reduced the originating and terminating charge (seasonal tickets) for Public Service Vehicles (PSVs) operating outside the Central Business District (CBD) by 50 per cent.
Speaking while presenting 2023/2024 Ksh40.2 billion budget before the County Assembly, Nairobi County Government Finance CEC Charles Kerich on Thursday, June 29, revealed that the move will enhance compliance by the PSVs, reduce congestion and potentially increase revenue collection by Ksh500 million.
Sakaja unveiled the move to incentivise matatus to operate outside the CBD. In the new changes, PSVs carrying between one passenger to thirteen will pay Ksh1,825 monthly, Ksh5,110 quarterly, Ksh8,760 – bi-annually and Ksh18,980 annually.
In the past financial year, PSVs within the designated picking and dropping zones were charged Ksh3,650 monthly, Ksh10,220 quarterly, Ksh17,520 bi-annually, and Ksh37,960 annually.
The county executive also observed that the budget is broken down into two, Ksh28.3 billion for recurrent expenditures and Ksh14 billion for development expenditures.
He revealed that the expenditure would be financed by Ksh20.7 billion from the national government and Ksh19.9 billion in revenue generated by the county.
Kerich highlighted the following on how the county government would continue generating revenues;
Collect More Revenue From Land Rates
The county government will be changing its strategy in the collection of land rates. According to Kerich, the number of ratable properties is expected to increase from the current 181,000 to approximately 241,000 properties.
Sakaja plans to leverage Geographical Information System (GIS) technology as a way to introduce sectional property rates specifically aimed at individual houses within a block of apartments.
The county executive intimated that this initiative is expected to increase income from land rates by approximately Ksh1 billion.
Collect More Revenue From Business Permits
Sakaja intends to restructure the Single Business Permits codes by introducing new parameters.
The permits will be issued based on the classification of businesses, which will be categorized into hyper, mega, large, medium, small, and mini.
“The new parameters will be charged as follows; Hyper - Supermarket at Ksh40,000, Mega Supermarkets at Ksh30,000, Large Butchery shop or retail service at Ksh4,000, and Kiosk at Ksh1,000, all shops and retail services in Nairobi City County owned Markets at Ksh2,000,” stated Kerich.
Kerich noted that the move would enhance fairness and compliance and encourage more businessmen, especially small traders who had previously defaulted to comply.
“We expect to collect an additional Ksh1 billion after implementation,” he noted.
Other Adjustments and Reductions Through the Finance Bill
Additionally, Sakaja will review charges for fire inspections and certificates, taking into account the sizes and activities of businesses, to enhance compliance levels.
“The old charges were too high that led to many clients to seek the same services from neighbouring counties that are charging lower fees,” Kerich stated.
Further, the county government will reduce the charges for annual licenses and permits for water bowsers and exhausters to enhance compliance.
"The old charges are too high resulting in non-compliance by many operators. This will also enhance the safety of the water and ensure a clean environment," noted Kerich.
A final reduction will be in the charges for complementary education institutions in informal settlement areas to as low as Ksh3,000 for small centres with less than 200 pupils.
The amount will be payable in instalments in line with the Nairobi City County Trade Licensing Act, 2019 to recognise and encourage the services given to vulnerable people in the society.
