NAIROBI (AFP) -- The Kenyan government on Thursday eased tax on a raft of commodities, but increased prices of gasoline and malt beer in budget proposals designed to shift resources to sectors that boost economic growth and quality of life in the impoverished country.

Finance Minister Amos Kimunya said the government will from July 1 remove import tax on childcare products, wheat flour, energy-saving bulbs, computer accessories, supply and treatment of natural water by public authorities as well as the import of kits to assemble bicycles.

In addition, the government will remove Value Added Tax on entertainment services provided by local artists, Kimunya said while presenting the 2006/07 budget estimates in parliament.

The minister eliminated charges on vehicle licenses and instead increased gasoline prices to cater for road maintenance fees.

Kimunya increased tax on malt beer, but removed duty on non-malt beer in order to crack down on illicit liquor.

Government expenditure for the next fiscal year stands at 461 billion shillings (6.3 billion dollars, 5.0 billion euros), down from around 508 billion shillings.

Stagnation

"After years of stagnation, the economy is poised for a sustained economic growth and development," he told the lawmakers.

Kimunya said the country recorded 5.8 percent growth in 2005 that was attributed to a brisk performance in the tourism sector.

But he called for more policies to curb wastage of resources through corruption, and to increase efficiency.

"A stable macroeconomic environment must be supported by structural reforms in order to more efficiently allocate our scarce resources," Kimunya said.