Taking Care of Tax Funded Developments: Karatina Open Air Market

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  • Post category:Blog on Tax
  • Post last modified:January 6, 2020
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The Kenyan government requires money for recurrent and development expenditures.

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(Photo by WAKA)

This money is provided by the Kenyans inform of taxes among other sources.

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Some of the developments undertaken by the government are markets, roads, schools and hospitals.

Modernization of Karatina market

The history of Karatina open-air market dates back to 1938. Over time, the market was relocated from various sites to its present location. In 2009 under the Economic Stimulus Programme (ESP), an initiative to upgrade the open-air market to a modern market was commenced.

The completion date was envisaged to be July 2013.

However, this did not happen and the project was completed in 2018, five years and three months late due to various problems such as political interference and interests resulting in a change of contractors.

This delay in completion affected the market, town, county and the country.

Effects of completion delays

Karatina market is the main economic lifeline for Karatina town, Nyeri County and to a large extent the whole country. Therefore, the delay in completing the market had numerous negative effects in all facets of life in Karatina town, Nyeri County and the whole country.

Some of the negative effects of the delay were economic (increased construction cost from kshs 260million to kshs 400million, lost revenues for the County government, lost taxes for the Central government and increased corruption – procurement, stores allocation, etc.).

Other negative effects were on development (slow urban development of the town, slow reverse migration back to the town, slow growth of the town and reduced vibrancy of Nyeri County economy.)

Trade in the market and region were also affected. The farmers were demotivated farmers (no market for their produce) and there was a lack of production for the many traders who source trade goods from the market. Also, there was lost business in the service sector such as transport to, within and from the market.

Poverty levels increased in Karatina town and the surrounding areas due to lost employment opportunities (in the farms, market and town), lack of earnings by other connected business such as hotel, catering and housing. Hence, this negatively affected the standards of living in the whole region.

Health was also affected in that there were incidences of diseases in the soggy temporary market where the traders had been relocated when the market was under construction. Increased poverty levels also result in poor health.

Karatina market was known globally as one of the largest open-air and vibrant markets in Africa. This attracted a lot of tourism activities to the town. With the delay in completion of the market, there were hardly any tourists.

It is hoped that with the opening of the market, then all is not lost. Some of these negative effects will be mitigated and the market will vibrant once more.

Taking care of the market

Traders in the market and the County government that collects levies and manages the market should not quickly forget their sufferings caused by the delayed completion of the market.

It is disheartening that after the President opened the market on 1st of November 2018, on 20th December 2018 hardily two months had passed and the market’s rubbish was being dumped at market entrances and the market was equally dirty.

(Photo by WAKA)

If the traders through the Market Association and the County government do not work together to clean the market, it may turn out to be like the famous Wakulima Market in Nairobi wherein 2005 the market had to be closed for the first time in 30 years since it was opened.

Apart from the mountain of dirt that was cleared, more than six thousand (6,000) rats (children, fathers, mothers, grandparents, great grandparents, cousins etc. – the whole clan) were killed.

A conversation with some of the traders made us realize that Karatina market traders do not know their right to demand a clean environment in the market. It is the same old offhand altitude from eras gone-by where people were expected to pay for services without asking questions or demanding for services.

The market traders must demand a clean market and proper disposal of the market waste since they pay for it. The Nyeri County government should also realize that it is not enough for them to collect market levies, they have a responsibility to ensure that the market is cleaned.

After all, the cleaning is not for free but the traders pay for it.

Cleanliness of the market will attract customers and this will translate into increased business for the traders. The market also creates an opportunity for the county government to market the county as a vibrant economic hub. This will attract investments in manufacturing for example packaging, slaughterhouses etc.

Karatina market and taxes

Modernization of Karatina market cost kshs 475 million. This money was from taxpayer’s money whether local or donated. This is in addition to the daily fees that the traders pay to the County government. Also, from 1st January 2019, the market traders and all other traders were required to start paying Presumptive tax to the Central government at the rate of 15% the license fees.

It is the responsibility of traders in Karatina market to ensure that the market is taken care of since the market was developed with taxpayer’s money and they are taxpayers. The traders are the owners of the market, it does not belong to the County government. The traders must jealously take care of the market by demanding that the market is cleaned. Otherwise, if the traders do not do this, after a few years there will be no market to write home.

For any clarifications, get in touch through the email.

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