The cost firms incur to list their shares on the Nairobi Securities Exchange (NSE) could be reduced if the National Treasury adopts the proposed capital markets policy in its current form.
The policy also proposes preferential corporate tax for listed firms as well as privatization of more state owned enterprises.
The Capital Markets Authority (CMA) Regulatory Policy and Strategy Director Luke Ombara says the proposed policy seeks to encourage more companies to list.
It is now emerging that despite the many tax incentives offered to investors listing on the NSE, this has not translated to increased investments as envisioned.
This has prompted CMA to review its policy that among others proposes a preferential corporate tax for listed firms on a pro-rata graduated basis.
With listings for the GEMs market at the NSE failing to pick up after attracting only six companies since the counter was set up in 2013 against a target of three new companies listed per annum, Ombara notes that, there have been challenges such as undervaluation and a perception that the segment is only designated for SMEs.
The policy proposes privatization of more state owned enterprises which in addition to the finalization in adoption of financial technology as a new source of raising funds are expected to stimulate activity at the bourse.
The government is proposing to offer preferential tax treatment to betting companies that reward their clients by buying for them shares of listed companies or treasury bonds.