Revenue commission maintains Sh370b allocation to counties

The Commission on Revenue Allocation (CRA) has maintained disbursement to counties for the financial year 2022/23 at Sh370 billion, citing economic uncertainty on National Treasury’s Sh2.1 trillion revenue projection.

The commission also cited the upcoming polls, which it noted could halt most of the economic activities. This comes hot on the heels of the country stabilising from the economic effects of the Covid-19 pandemic.

The Sh370 billion allocation has been opposed by the Council of Governors (CoG) who want the figure raised to Sh381 billion. CRA Chairperson Jane Kiringai said the only way such can be achieved is either through more loans or more taxes.

She told the CoG to suggest how this amount should be raised. Ms Kiringai said there is no much headroom to allocate more funds to any level of government.

This means the allocation to the State for 2022/23 will be maintained at Sh1.7 trillion. Equalisation fund allocation stands at Sh6.8 billion.

“The counties’ allocation of Sh370 billion is equivalent to 27.3 per cent of the most recent audited and approved accounts for the financial year 2016/17 amounting to Sh1.34 trillion,” reads the recommendation on equitable sharing of revenue for the financial year 2022/23 presented by the Commission.

Kiringai said the projected Sh2.1 trillion by Treasury is in the range of Sh330 billion more than what was collected in the previous financial year.

She said the 2022/23 allocations are based on slow economic growth, constrained fiscal framework, public debt and the 2022 polls. “We are walking on a tight rope on how much revenue we can recommend to the two levels of government,” said Kiringai.