The Times Tower that hosts the Kenya Revenue Authority. [Photo/mapio.net]

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Kenya is expected to spend 34.7 percent of revenue in the next financial year on servicing the public debt against the recommended threshold of 30 percent.

This according to the Institute of Certified Public Accountants is due to the rising public debt and the several loans that are set to mature in the next financial year.

Accountants fear that Kenya may default on servicing her debts if KRA fails to meet its revenue targets.

It is a catch 22 situation for the country as it hurries up to reduce her ballooning public debt but is at the same time finding herself allocating more cash than recommended to repay the debt.

Accountants note that debt interest and redemption for the same period is projected at 621.8 billion shillings, up from 466.5 billion shillings in the current financial year primarily due to the maturing of several loans.

This is a red flag especially if KRA fails to meet its revenue collections target.

Accountants are also concerned with the delay in finalizing the audit and verification assets belonging to counties five years since the process began, and fears that being closer to another election cycle, the exercise may not be completed.

ICPAK says there is need to improve absorption of development expenditure to create more jobs and improve service delivery.