June 13, 2024
American Risk Advisor Warns Kenya's Business Regulations in The Finance Bill 2024

American Risk Advisor Warns Kenya’s Business Regulations in The Finance Bill 2024

Declan Galvin, an American risk expert residing in Kenya, expressed concern about Kenyan corporate regulations, noting that some of the laws are sometimes ambiguous and conflicting.

The nation has been swiftly enacting new regulations without carefully examining the current climate or retiring previous legislation, claims the Managing Director of Exigent Risk Advisory.

In an interview with Spice FM, Galvin questioned why Kenyan business is more regulated than US business, claiming that this deters investors most of the time.

“It is an enormous frustration for business especially if they are bringing capital in,” stated Declan while giving examples to justify his point.

Galvin went on to add that the taxes imposed by the government may have an immediate impact on the predictability and predictions of enterprises for both domestic and foreign start-ups, which is critical for organizations.

To that aim, Galvin advocated for the gradual introduction of regulations to allow firms to alter operations.

“If we revise those rapidly overnight or in course of the month as opposed to phasing them out,  say this will be a new thing in twelve months or in twenty-four months this will come into place, that creates a certain degree of uncertainty whether you are a Kenyan business or a foreign corporation,” elaborated Declan.

Despite critiquing Kenya’s economic policies, Galvin explained that the country remained at the forefront of African investment potential.

The risk advisor praised Kenya, adding that it has excelled in developing strong bilateral connections with Western nations rather than relying solely on handouts.

Galvin’s comments came in the midst of a discussion over the Finance Bill, 2024, which proposes to impose a number of additional taxes.

Non-residents will be particularly interested in a proposed piece of legislation that would require them to pay 20% of their gross turnover in taxes on money generated by having a digital presence in the country.

“Notwithstanding any other provision of this Act, a tax known as significant economic presence tax shall be payable by a non-resident person whose income from the provision of services is derived from or accrues in Kenya through a business carried out over a digital marketplace,” read the Bill in part.

American Risk Advisor Warns Kenya’s Business Regulations in The Finance Bill 2024

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