NAIROBI, Kenya- The Public Procurement Regulatory Authority (PPRA) has officially introduced a new financial directive that is set to shake up the procurement landscape in Kenya.
The Public Procurement Capacity Building Levy Order, 2023, comes into effect on September 1, 2024, and it’s bringing a small but significant change to how suppliers will handle their contracts.
The 2023 Levy Order, issued under Legal Notice No. 206 by John Mbadi, Cabinet Secretary for National Treasury and Economic Planning, mandates that suppliers involved in public procurement will now be required to contribute 0.03pc of the value of their signed contracts.
This percentage, calculated before taxes, will go towards a fund aimed at boosting the capacity of those involved in public procurement and asset disposal.
This levy isn’t just a suggestion; it’s a legal obligation with clear timelines. From September 1, 2024, any procurement contracts, including those with extensions or variations, will be subject to the levy.
Procuring entities must ensure they remit these amounts via the eCitizen payment platform by the 20th of the month following the signing of a contract.
Missing this deadline will attract a 5pc penalty on outstanding amounts. Additionally, monthly returns on deducted and remitted levy amounts are required to be filed through the Public Procurement Information Portal.
This new directive doesn’t just affect suppliers; it has implications across the board for contractors, consultants, and anyone involved in the public procurement system.
The PPRA is serious about compliance and has already scheduled stakeholder sensitization forums starting September 2024 to help everyone get on board with these new rules.
Continuous engagement will also be a key part of the process, ensuring that everyone understands and adheres to the Levy Order’s provisions.
