Kenyan manufacturers call for tax breaks to boost competitiveness

NAIROBI, Oct. 16 (Xinhua) - Kenyan manufacturers on Tuesday called for tax breaks to boost the competitiveness of the sector.


(File Photo: VCG)

Sachen Gudka, chairperson for Kenya Association of Manufacturers (KAM), said that the current production costs in Kenya are approximately ten percent higher compared to other low-cost manufacturing nations.

"We are therefore urging the government to lower taxes so that we can manufacture products that can compete in the region," Gudka said during the fourth annual tax summit.

The three-day event brought together over 100 policy makers and tax experts to review ways to widen Kenya's tax base.

Gudka said that Kenya used to be a key exporter of manufactured goods to the East and Central African region but rising costs have made Kenya gradually lose the market.

Gudka said that tax breaks will provide incentives for manufacturers to expand their production capabilities. According to KAM, the manufacturers sector currently provides about 300,000 direct jobs.

"With additional incentives, we can double the number of jobs in the next five years," he said.

He said that Kenya is not competitive in industrial sectors that are highly dependent on affordable electricity.

The chairperson noted that the agro-processing, textile, apparel and leather sectors represent industries with biggest potential in Kenya.