Death By Licensing: How Nairobi County Is Discouraging Small Businesses

In this post, we explored ways the government could make it easier for us to do business in Kenya, and key was the licensing procedures and costs.

Well, since then, not only has the number of licenses increased, the county government (Nairobi) also reviewed costs upwards. This morning I looked at the list of licenses one needs to operate a hotel in Nairobi, and I am still in shock. The licenses below cost more than Kshs 700,000 in total  per annum and for a small hotel. This doesn’t take into account the fact that the business will need to pay  VAT, corporate tax, NHIF, NSSF, Catering Levy among others on an ongoing basis. So here goes:

List of licenses one needs to operate a hotel in Nairobi

1. Nairobi County business permit

2. Food and hygiene license

3. Outdoor advertising license (for every outdoor sign you have)

4. Hotel manager’s license

5. Liquor license

6. Fire protection license

7. Land rent payment

8. Land rates payment

9. Music Copyright Society of Kenya Limited license

10. Kenya Association of Music Producers license (this and “9” are charged according to the number of TVs in the premises)

11. Lift registration license if you have an elevator (issued by the Ministry of Public Works)

Are we really serious about being friendly to small businesses?