WCA November 2011

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Industry news
Kenyan Business Daily reports that
Kenya Revenue Authority (KRA) and
the Rural Electrification Authority (REA)
are locked in a Sh1.85 billion tax
arrears battle, the outcome of which
could slow down the connection of
more Kenyans to the national
electricity grid.
The power agency, through Treasury, is
pushing for the tax authority to waive
its tax backlog on the grounds that its
operations are not profit driven and
that it does not sell commodities. It
also argues that it was not aware of its
tax obligations.
KRA is insisting that the agency is not
exempted from paying taxes and that
it should clear the backlog
accumulated since 2006, when the
former department in the Ministry of
Energy was upgraded to an
autonomous corporate body.
“REA had assumed that they are not
supposed to pay tax, which is not
correct,” finance assistant minister
Oburu Oginga told Parliament. “We
have already started discussions on
the matter with KRA on the possibility
of exempting REA from paying taxes.
“This would most likely necessitate an
amendment to the Energy Bill,” added
Mr Oginga.
Electricity consumers pay a five per cent
rural electrification levy in their monthly
power consumption bills that is passed
on to REA to accelerate the pace of
electricity penetration in rural Kenya.
Settlement of the tax arrears looks set
to slow down rural electrification
projects, which have helped boost the
country’s electricity penetration rates
from 12 per cent of the population in
2005 to about 30 per cent last year.
Rural Electrical Authority – Kenya
Fax: +254 020 495 3600
Email:
Website:
Kenyan power firm
stands fast on tax bill
Access Kenya Group, Kenya’s
corporate data and infrastructure
provider, and Airtel Kenya have
partnered to provide customers
with fixed voice services over fibre
optic cable.
The two companies have signed a
contract that grants Airtel access
to Access Kenya’s extensive fibre
network. The deal is to provide
connectivity services for Airtel’s
fixed line voice services, also
known as E1. Airtel Kenya will now
buy E1 circuits from Access
Kenya’s fibre optic network.
Access Kenya Group MD Jonathan
Somen said Airtel is set to leverage
Access Kenya’s extensive fibre
presence to reach more
customers, more buildings and to
provide reliable services on Access
Kenya’s network.
Access Kenya Group – Kenya
Fax: +254 203 600 01
Email :
Website:
Providing fibre
backhaul support