|
Investment Incentives The
Government policy is aimed at extending facilitation measures in favour of private
sector investment. The
following is a summary of current incentives that have been put in place:
Investment
Allowance
Investment
allowance is provided as an incentive for investment in the manufacturing and
hotel sectors at the rate of 100 per cent for the period July 2000 to December
2001, 85% for 2002, 70% for 2003, and 60% for 2004 countrywide. For
Manufacturers Under Bond (MUB), the applicable rate is 100 per cent. In
addition, eligible capital expenditures have been expanded to include certain
infrastructure and environmental protection equipment related to the manufacturing
activity. Depreciation
Liberal
rates are allowed for depreciation of assets based on book value as follows:
Buildings
| Industrial
Building | 2.5% | (straight Line) | | Hotels |
4.0% | (straight Line) |
Machinery
Tractors,
combine harvesters,
Earth-moving equipment, and
Similar
vehicles |
37.5% | (Declining
Balance) | Other
self-propelled vehicles,
Including aircraft |
25.0% |
(Declining Balance) | All
other machinery, including
ships | 12.5%
| (Declining
Balance) | Computers
and other office
equipment | 33.3%
| (Declining
Balance) |
Loss
Carried Forward
Business
enterprises that suffer losses can carry forward such losses to be offset against
future taxable profits. Remission
From Customs Duties Duties
on capital goods, plant and machinery are at the rate of up to 5%. Large
scale private investment projects whose expenditure on productive physical assets
are in excess of US$5 million within a two year period, and that will generate
net economic benefits for the country, can recover the value of import duties
paid on imported capital goods for the project against income tax liability.
Labour
Kenya
has an abundant supply of well-educated and skilled Labour force available at
international competitive rates. Minimum wages vary according to the type of job
and locality. A
cordial system of industrial relations has been developed over the years. Trade
unions are registered under the Trade Union Act. They are organized by the industry
rather than craft. Union membership is voluntary and there is a well-established
Industrial Court for settling Labour disputes. | 
