Kenya: Taxing times for street hawkers
Reporter: Eric Kadenge
Duration: 00:06:48
Studio cue
Street hawkers face a daily battle with the authorities to sell their goods on the streets of Nairobi. Some street vendors would prefer to run a legitimate business and pay tax on their earnings. So far that’s proven hard to organise and many vendors on the wrong side of the law regularly pay out as nearly as much money in bribes as they would in tax. Eric Kadenge reports.
Sfx: traffic
Reporter Eric Kadenge:It is now about 7.30 pm East African Time and I am sitting along one of the busy streets where people are now heading back to their homes. Street vendors sell their wares along such a street as this where they have a huge number of pedestrians and motorists. Street vending is one of the informal activities that account for 70 per cent of Nairobi’s employment – while 60 per cent of Nairobi’s population actually lives below the poverty line, that is below one dollar a day.
Eric Kadenge:
I was in Nairobi’s central business district,trying to interview a street vendor - or hawker - about how they earn a living, but it was hard- as they don’t usually stay still for very long. But eventually I caught up with Lucy Wambui.
Lucy Wambui:I am selling clothes and so forth
Eric: From the money that you get here what do you do with it?
Lucy: For sure I have kids, two kids, 11 years and three years
Eric: And they both depend on what you do here?
Lucy: Yes
Eric: Today I’ve been having a lot of trouble finding you because of the police. Right now, where are the police?
Lucy: They are down there
Eric: So if they happen to come up right now you will have to run away
Lucy: Yes! We have to run away.
Eric Kadenge:Street hawking is illegal under the general nuisance law. I saw the police using tear gas to disperse the hawkers. Some visitors sympathise with their struggle to earn a living, while others agree that they are justa public nuisance.
Tourist vox pop
It’s distasteful and they run after you and it actually gives I think, Nairobi and Kenya a bad reputation for tourists
Tourist vox pop two
Maybe some more regulation of who is allowed to be in..I think they’re hurting the shop owners as well
Vox pop three
They are law-breakers, they are doing business without licence but well I’ll say hawkers, they’re a sign of a problem in society. I guess nobody would wish to be a hawker but circumstances have forced them out on the street to earn a living
Eric Kadenge: At times the hawkers’ merchandise might be confiscated or they have to spend their earnings on bribes – so that the inspectors leave them alone.
Lucy: Harassment, we are so harassed by this government, once they took your belongings..
Eric: They don’t bring it back
Lucy: Yes, you cannot get it back
Eric: And how much do you get in a day or in a month from your business?
Lucy: We are not selling too much because of harassment. If there is no harassment we can do a good job, a profit of 2000 per day. For today, I didn’t get anything because there was rain, harassment, today I’ve only 200 in my pocket
Eric:So, less than three dollars today - but on a good day, a hawker like Lucy, could make up to 30 dollars or more. One of the criticisms against workers in the informal economy is that they are not contributing directly towards any services. Wilfred Marube is the Chief Public Relations Officer of Nairobi City Council.
Wilfred Marube: They litter the place, they leave a lot of waste and the council spends money to clean up that waste. They use the roads and the council repairs the roads, they use the street lights and the council does all that so we need money from them. We call them informal traders and right now the council we are working on a strategy to mainstream the informal sector into the mainstream economy which is being supported by the minister of local government. Then we will be able to have modern kiosks, markets where people will be able to trade in. In other words I think it’s a good opportunity for people to earn their living.
Eric Kadenge:So officials accept that hawkers are here to stay, but should be trading in designated areas. This could be one step towards integrating them into the formal economy so that their earnings can be taxed. Michael Otieno is the national coordinator of the National Tax Payers Association.
Michael Otieno: The Kenyan Revenue Authority has been attempting to bring what we are calling the informal sector into the formal economy. The taxman can’t catch them because they will go and sell their wares, make their profit, then disappear. One of the biggest difficulties that we experience in Kenya today is that our tax collection is relatively very low. The few that are paying tax are paying on behalf of other people. If everyone was brought into that bracket of paying tax we would have more money and it is possible the government will provide better services.
Eric Kadenge:Tax is a hot topic here in Kenya at the moment, mainly because members of parliament themselves are only paying tax on their basic income, whilst the majority of their income is made up of tax-free allowances. Michael Otieno thinks that everyone – including MPs and street hawkers would be better off paying tax.
Eric:Do you think if street vendors were to be included in the tax bracket it would be easier for them to engage the government in demanding probably better markets?
Michael Otieno: Sure, as it is now the government, they simply say you are running your businesses illegally but as long as they pay tax I believe they will have a very strong moral authority to demand for those services
Eric Kadenge:At the moment, there is one place where vendors can work on a more official basis - that is in the Muthurwa market - where a public bus terminus ensures plenty of customers. But it is overcrowded, choking with traffic and vendors of course must pay the council for a pitch here (though they still don’t pay income tax). But, as Wilfred Marube explains, the council hopes to create more markets like Muthurwa in the future.
Wilfred Marube:Muthurwa is not enough but they are utilising it but other markets are coming up and in a short while the council will be unveiling the various markets.
Eric:You know at the moment we have about 6,000 hawkers being taken care of at the Muthurwa and figures estimate that we have about 15,000 hawkers in Nairobi, do you have any estimate of the number of market space that would be available in the new plans?
Wilfred: You are talking about the centralisation, that’s why I say, what we are moving towards each division having some market. These are honest, hard-working Kenyans earning their living and that is why we are coming up with an integrated approach on trying to mainstream them in the formal sector
Eric Kadenge:In the meantime, the majority of hawkers – including Lucy Wambui - must take their chances on the streets of Nairobi’s central business district.
Eric speaking to Lucy Wambui:If you were not a street vendor, if you were not a hawker, what would you like to do?
Lucy Wambui: I’m very good at business because I’m a business lady
Eric: So what is your word for the government?
Lucy: To have a good market for us where we cannot be harassed. If you could pay, it’s good, yeah.