Why Kenya power might pay you for power blackouts.
10 may 2021.
Good morning !!
Even though it is a day later, we still have to celebrate..
Happy Mother’s day to all mothers in the world ! Take a minute today to share with someone one thing about your mum that makes you smile.
Earlier this week, I overheard my mum asking her colleagues whether they were aware of why Carrefour had low discounts. When they said no, she happily explained why. Then she said “Well, you should subscribe to my son’s newsletter, he explains these things every week !” then shared the subscription link. Talk about marketing !!
Kenya Power might start to pay consumers for Blackouts
Everyone knows the feeling of getting dropped off zoom calls multiple times in a day because of power blackouts. This is worse for industries/businesses that rely on electricity for operations. As of last year, reports showed that most industries and institutions were seeking the alternative of solar to run their businesses efficiently.
The draft Energy (Electricity Supply) Regulations published on Tuesday by the Energy and Petroleum Regulatory Authority, requires Kenya Power to compensate consumers for financial losses, equipment damage, physical injuries and death which result from power outages, poor quality or irregular supply of electricity.
Taxes
1. KRA’s (Kenya Revenue Authority) new strategy to fight Tax evasion
Starting from the end of this financial year, KRA will have the power to deregister and cancel KRA PINs (personal identification numbers) for persons who fail to file tax returns without cause.
what is the Cost of Deregistration? - Being blocked from access to transactions and services such as: a) registration of land titles b) underwriting of insurance policies c) customs clearing d) registration of businesses and Companies.
2. Treasury to re-introduce Excise duty of 20% of amount staked on betting
The Finance bill 2021 reintroduces a 20% Excise duty on amount staked when betting. (note that the amount staked is taxed whether you lose or win the bet).
An illustration of how this works - Evans is a punter and uses the Betin app to bet. On Wednesday, he hoped that Chelsea would lose the UEFA Champions league semi-final. So he staked ksh 100 and watched the game. Unfortunately, Chelsea won and he lost the bet. The taxman (KRA) still took ksh 20 from the ksh 100.
Implication on betting Companies - This expands the number of taxes levied on betting companies. Currently, they are required to :
pay Corporate tax on profits at 30%
pay tax on gross gaming revenue at 15%
Withhold 20% of winnings and remit to the taxman.
Markets
An amendement to section 35 of the Capital Markets Act by the finance bill 2021 will require the Capital markets tribunal to resolves disputes within a 90 day period. This aimed at improving efficiency in the capital markets.
Homeboyz post net loss of 22 million shillings for the year 2020. This is the first public announcement after its listing on the Nairobi Stock Exchange. They attributed the loss to government restrictions that prohibited public gatherings. Most of Homeboyz revenue is derived from events management and Soundtraxx business.
Central Bank of Kenya data revealed that Kenya’s mobile money transactions for the first 3 months of 2021 hit 1.7 Trillion Kenya Shillings.
The United Arab Emirates is now the 3rd largest buyer of Kenyan tea replacing the United Kingdom.
What has your Chama invested in? - A move From dead assets to live assets
What is the most popular asset that chamas in Kenya invest in? …. you probably guessed right, a piece of Land.
Data shows that most people in chamas work 8-5 jobs meaning that they have little time to focus on the chama. Coupled with the lack of specific goals for investment, the chama seeks safer investments with little to no supervision and most times this is ‘an idle piece of land’.
After a few years, there is the risk of discontentment among members because there are no returns on the investment made. Most times, this leads to dissolution of chamas. Worse still, discontentment breeds desperation which leads to chamas falling prey to Ponzi schemes.
In order to generate returns, there is need to invest in live assets. However, these assets demand a lot of time and effort and if members don’t have the time for this, a better investment option would be financial assets that are controlled by strategic investors.
The best step for your chama is to seek investment advice from a professional.
Next weeks issue will consider the concept of ‘amalgamated chama’s and whether they are a good option’
Startup Focus:
LAMI Technologies raises $1.8million to scale insurance platform across Africa.
Founded in 2018 by CEO, Jihan Abass (centre), Lami Technologies is an insurance platform that has digitised the insurance value chain into one platform. This means that anyone can use Lami to create and distribute insurance products to consumers. The advantage of using Lami is that it eliminates the high development costs and time spent in creating and launching insurance products.
The motivation for Jihan Abass was to solve the problem that 97% of Africans are not able to buy insurance. The funding round was led by Accion Venture Lab, a seed investment that supports financial services for underserved markets.
Somalia to revive ties with Kenya after severing ties 6 months ago
6 months ago, Somalia recalled its ambassador to Kenya and expelled the Kenyan ambassador from Somalia. The reason for this was that Somalia believed Kenya was meddling with Somalia’s politics. Recently, relations between the two countries have been tense following the commencement of hearings at the International Court of Justice concerning the maritime dispute between the countries. Unlike Somalia’s stand, Kenya’s position is that the dispute should be solved outside the court.
The recent move by Kenya to close Dadaab and Kakuma refugee camps by 2022 has been interpreted as a response to Somalia’s adamant stance that the maritime dispute be heard at the International Court.
However, last week the deputy information minister of Somalia announced that diplomatic relations had been restored and that restoring relations between the two countries was important for political stability in Somalia.
Podcast Feature: Why I should be paid for my data
Ted x daily podcast - why we should be paid for our data
No doubt that the biggest companies in the world thrive on the data of its users. From the number of steps you make in a day, the number of hours you scroll through social media and even the amount of hours you sleep, these companies posses and use this information.
On this podcast, Jennifer Scott urges us to look at data from a different lens - of private ownership of data- With private ownership rights, one should have the right to use, destroy, trade or sell their data. She recognises that the world is slowly moving towards the recognition of private ownership rights for data. However, she admits that currently, the focus is primarily on privacy rights.
She believes that the recognition of private ownership rights will solve the issues around “big tech’s” use of consumer data. She gives the example of UBDI, an app that helps you make money by selling your data anonymously to tech companies, as the future of personal data.
Should Patent rights for Covid-19 Vaccine be suspended?
The United States has supported the waiving of patents for Covid-19 vaccines. The reason given is that this would help boost vaccine production to enable developing countries fight the resurgent virus that has ravaged countries like India and Brazil.
The European Union announced on Thursday that it would have discussions on whether to support the US on this stand. However, German Chancellor Angela Merkel opposed waiving of patents and stated that the main issue with production of vaccines was not intellectual property but quality of the vaccines and production capacity of companies.
Pfizer CEO argues that even if the waiver is given, there is lack of proper facilities and skilled workers to replicate the vaccines. He states that the biggest risk would be counterfeit vaccines that do not meet the quality threshold.
Other ConversationStarters
The Kenyan National Assembly passed the BBI (Constitution Amendment bill 2020). out of the 320 votes cast, 235 Members of parliament voted yes, 83 voted no, and two absconded.
what next?
The bill will go to the senate on 11 May 2021 for voting.
if it passes, the bill will be submitted to the IEBC (independent Electoral and Boundaries Commission) which will organise a referendum.
KRA has now automated applications for tax exemptions certificates and registration of tax relief schemes. This can be done through the iTax portal. It is important to note that all schemes that had already been issued with income tax exemption certificates will be required to apply for the i-Tax generated certificates.
Uber announced the launch of electric motorcycles for earners on the Uber platform to help reduce operational costs of fuel for the drivers.
On Wednesday last week, Visa announced a partnership with Tala (mobile lending app) aimed at providing easier access to cryptocurrencies for underbanked consumers.
Athletes have been banned from wearing Black Lives Matter clothing at Tokyo Olympics.
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