1.0 The Africa Enterprise Challenge Fund
The AECF is a development institution which supports businesses to innovate, create jobs, leverage investments and markets to create resilience and sustainable incomes in rural and marginalized communities in Africa. Launched in 2008, the AECF has mobilized over US $356 million to date, leveraging more than US $658 million in matching capital and improving the lives of more than 19 million people in 2018 alone through jobs and increased household incomes. The AECF has so far supported 268 companies in 26 countries in sub-Saharan Africa across 40 value chains in our focal sectors of agribusiness and renewable energy.
In the new 2018-2020 strategy, our goal is to “double our impact in half the time”. To achieve this, we will continue to focus on the agribusiness and renewable energy sectors, increase support to climate-smart technologies, refine our challenge model, expand regional presence, deepen the focus on gender, youth and employment by expanding our products and partnership approach to better meet our investees’ current needs; and ensure they rapidly scale and transition to external financing and sustainability thereby attaining our vision of ‘A Prosperous and Enterprising Rural Africa’.
In delivering on the strategy, AECF’s Investments Advisory Services (IAS) department is increasingly providing supplementary support to AECF investees to accelerate their business growth, sustainability and impact delivery.
2.0 About PowerGen Renewable Energy East Africa
PowerGen's objective is to install alternating current (AC) solar micro-grids in off-grid commercial centres in Tanzania and Kenya allowing business owners to use electricity for productive loads. Most existing off-grid electrification methods offer direct current (DC) electricity, which only permits lighting, phone charging, and the use of specially designed appliances. AC micro-grids allow customers to begin by using small appliances and move upwards on the energy ladder to heavier appliances without additional capital investment or throwing away a smaller system.
The AECF invested seed capital in PowerGen Renewable Energy East Africa to enable the company to identify new sites in the off-grid areas and accelerate the uptake of mini-grids for productive use in Kenya and Tanzania.
3.0 Purpose and Deliverables of the Assignment
As a micro utility, PowerGen finds itself exposed to the risk of non-compliance with the prevailing tax regime in the countries of operation (Kenya and Tanzania). Unlike mainstream solar home system companies that compute tax based on the sale of products, a utility does not sell the infrastructure to the end-users. Instead, the company allows users to incrementally pay for the energy service (through electricity bills) while the assets remain the property of the company. In light of this, PowerGen East Africa wishes to engage a reputable audit firm to undertake a tax health check for the financial years 2017,2018 and 2019.
The purpose of the assignment is to ensure that PowerGen Renewable Energy East Africa always remains tax compliant and that any risks are flagged and addressed. An analysis of the current Tax laws in Kenya and Tanzania will also be done to assess their impact on this business.
3.1 Specific Duties and Responsibilities of the Consultant
The scope of engagement will include the following:
a) Conduct tax health check services in respect of Corporate Income Tax (CIT), Pay as You Earn (PAYE), Value Added Tax (VAT), Withholding Tax (WHT), statutory deductions and Customs Duty from the years ended 31 December 2017, 31 December 2018 and 31 December 2019.
b) Identify all areas of noncompliance and proposes a path to resolution within 6 weeks of contracting
c) Analyze the current Tax laws and their impact on this business.
d) Deliver training to the PowerGen teams in Kenya and Tanzania on local tax laws and how to ensure compliance
3.2 Outputs and Reporting Requirements
Comprehensive TA delivery report, detailing:
Analysis of the tax health check for the years ended 31 December 2017, 31 December 2018 and 31 December 2019, including areas of non-compliance.
A clear road map to the resolution of any sticky areas/areas of non-compliance
Analysis of current tax laws in Kenya and Tanzania and their impact on PowerGen’s operations
Training report on tax laws and how to ensure compliance
4.0 Duration of Service and Location
The duration of the service will be 20 man-days spread over 3 months. This service is expected to commence on 15th August 2020. This assignment will cover PowerGen’s operations in Kenya and Tanzania.
5.0 Proposal Submission
Qualified consultants (individual or institutional consultants) are invited to submit the proposal that includes the following:
a) Qualification and experience of the individual/institution.
b) Approach and methodology to undertake this assignment.
c) Previous experience in similar assignment(s).
d) Detailed financial budget (in USD) and work plan.
e) Technical and Financial proposals will need to be submitted as separate documents.
6.0 Qualifications and experience
a) Master's degree in taxation, business administration, or accounting
b) The team allocated should have CPA certification or equivalent
c) More than 5 years of tax experience
d) Demonstrate understanding of Kenya and Tanzania Tax law
e) Experience in supporting off-grid companies is recommended
The consultant will be accountable to the AECF’s Advisory Manager.
The AECF is obliged by the Kenyan tax authorities to withhold taxes on service contract fees as well as ensure VAT, is charged where applicable. Applicants are advised to ensure that they have a clear understanding of their tax position with regards to provisions of Kenya tax legislation when developing their proposals.
9.0 Evaluation Criteria
An evaluation committee will be formed by the AECF and shall include employees. All members will be bound by the same standards of confidentiality. The Vendor should ensure that they fully respond to all criteria to be comprehensively evaluated.
The AECF may request and receive clarification from any Vendor when evaluating a proposal. The evaluation committee may invite some or all of the Vendors to appear before the committee to clarify their proposals. In such event, the evaluation committee may consider such clarifications in evaluating proposals.
In deciding the final selection of qualified bidder, the technical quality of the proposal will be given a weighting of 80% based on the evaluation criteria. Only the financial proposal of those bidders who qualify technically will be opened. The financial proposal will be allocated a weighting of 20% and the proposals will be ranked in terms of total points scored.
The mandatory and desirable criteria against which proposals will be evaluated are identified in the table below.
Key Areas for Evaluation/ Assessment
a) Technical Proposal -80
i) An understanding of the consultancy requirements;
· Demonstrate understanding of the assignment -5
· An in-depth understanding of Feed formulation and quality management-10
ii) Methodology and work-plan that will deliver the best value on the assignment: Demonstrate the capacity to deliver the task(s) within a realistic timeline, based on the consultancy days designated per task.-20
iii) Strategy and demonstrated capability to deliver a large part of this assignment virtually. Preference will also be given to consultants who have a presence in Tanzania and Kenya.-10
iv) Relevant services undertaken by the bidder in the past engagements: Demonstrate relevant experience and recent engagements with companies in the Energy and off-grid industry.-20
v) Detailed reference list indicating the scope and magnitude of similar assignments:
· Letters of reference from past customers or associates to the lead consultant or the consulting organization.-10
· Registration and other relevant statutory documents (applies to institutional consultants).-5
b) Financial Proposal: Clarity, relevance, reality to market value/ value for money of cost for the assignment (inclusive of any applicable tax)-20
AECF reserves the right to determine the structure of the process, number of short-listed participants, the right to withdraw from the proposal process, the right to change this timetable at any time without notice and reserves the right to withdraw this tender at any time, without prior notice and without liability to compensate and/or reimburse any party.
How to apply Application Details
To be considered, your proposal reference “CONSULTANCY TO ASSESS IMPACT OF TAX LAWS AND TO CONDUCT A TAX HEALTH CHECK FOR POWERGEN RENEWABLE ENERGY EAST AFRICA” must be addressed to [email removed] and received by Thursday, 6th August 2020 5:00 PM EAT.**
CONSULTANCY TO ASSESS IMPACT OF TAX LAWS AND TO CONDUCT A TAX HEALTH CHECK FOR POWERGEN RENEWABLE ENERGY EAST AFRICA
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