The National Treasury on Monday, September 6, opened the door for fresh suggestions on proposed minimum fees, which accountants can charge for their services, sparking criticism.
Treasury is under fire for entertaining the idea from accountants after the Competition Authority of Kenya (CAK) shot it down in 2016, arguing that it would limit competition.
Earlier in 2015, the accountant through their umbrella body, the Institute of Certified Public Accountants of Kenya (ICPAK), had tried to push for their exemption from the competition rules and be allowed to set a minimum consultancy fee for accounting services.
The accountants now want to be allowed to charge their services on an hourly basis with additional compensations, a move that other industry players, including the CAK are against.
According to the proposal, individuals will part with Ksh 2,000 when applying for Kenya Revenue Authority (KRA) PIN, taking instruction from a tax agent, filing returns or even obtaining a tax compliance certificate(TCC) and other tax services.
For business partnership, they will part with Ksh7,500 for the mentioned services and the local firms will have an increment from the business partnership amount by Ksh 2,500 bringing it to Ksh 10,000.
“Taxation services, include tax advisory services and related work for organisations and individuals provided to assist clients to comply with tax laws, with respect to tax administration procedures,” according to the proposed regulations.
Additionally, “an accountant in practice shall not agree or accept any remuneration less than as provided by this order and any such action shall amount to misconduct as defined in the Accountants Act.”
This brings the Treasury in a row with regulatory bodies like Competition Authority of Kenya(CAK) who opposed the move a while back in November,2016.
“Introduction of fee guidelines will decrease competition, increase costs, reduce innovation and efficiencies and limit choices to customers and is, in fact, likely to raise the cost of accountancy services beyond the reach of some consumers,” CAK had complained earlier while rejecting the proposal.
“Overall, the net impact of the proposed regulatory rule is positive on the practice of the accountancy profession in Kenya and beyond including qualifications for the profession,” Treasury Cabinet Secretary, Ukur Yatani, said while supporting the move by accountants.
In the current structure, there are no guiding parameters on the consultancy fees that see some get underpaid or others going overboard.
