REMARKS BY THE COMMISSIONER GENERAL DURING THE TAXPAYER’S DAY

SPEECHES 31/10/2018

 REMARKS BY THE COMMISSIONER GENERAL DURING THE TAXPAYER’S DAY

Your Excellency the President of the Republic of Kenya,

Cabinet Secretary of the National Treasury,

Cabinet Secretaries with us today,

Principal Secretaries present,

Chair Persons and CEOs of various Associations,

Distinguished Guests,

KRA Staff,

Ladies and Gentlemen.

 

Your Excellency Sir,

On behalf of the Board and Kenya Revenue Authority staff, I wish to express our gratitude for your presence here to preside over this significant activity in our National Calendar, when we recognize and reward distinguished taxpayers from various sectors of the economy.

Your Excellency Sir,

You have consistently presided over this event since you took office, a fact that confirms the now established tradition, where the Head of State leads in celebrating all Taxpayers’ Day. We shall continue reciprocating the confidence demonstrated by your presence by taking all measures necessary to ensure that those we serve, receive quality services that encourage them to embrace tax compliance.

This event is the culmination of a month-long series of activities that make up the Taxpayers’ Month. The Taxpayers’ Month is held annually every October and it is dedicated to appreciate all taxpayers for the pivotal role they play in the development agenda of this nation.

As it has been the tradition, KRA appreciates taxpayers in different ways throughout the month. Some of the major activities this Taxpayers’ Month include early morning activations, tax clinics, taxpayer visits, the Tax Summit and Corporate Social Responsibility initiatives. I am sure most of you have bumped into KRA staff in the early morning traffic, this month, during the Customer Service Week. We have also visited a good number of you at your places of work just to express our gratitude for the important role you play in this country. In a nutshell, we are telling you that KRA values you by all means and that your efforts do not go unnoticed.

Unlike the past years, we did not hold the Taxpayers’ Day in 2017 owing to the political landscape then. It is for this reason that the 2018 Taxpayers’ Day will be a double award ceremony where we shall award both the 2017 and 2018 distinguished taxpayers. We at KRA believe that a person who feels appreciated will always do more than expected and it is for this reason that we express our gratitude.

Your Excellency Sir,

The 2018 Taxpayers’ Month has been anchored on the theme; Expanding the Tax Base to Enable the Big 4 Agenda. At KRA, we understand the task ahead of us in terms of collecting revenue to make the Big 4 Agenda development plan a dream come true.

I would like to assure you that KRA is fully committed to going an extra mile to facilitate funding of this tremendous project and to make the dream of this country come true.

To achieve this, we have embarked on tax base expansion as one of the strategic measures of enhancing revenue mobilisation under revenue enhancement initiative in our plan of bringing in more revenue.

KRA has prioritised the use of technology to better facilitate tax collection. In the case of Customs, the Simba System is being replaced with a more versatile platform known as the Integrated Customs Management System (iCMS), that will help address intractable challenges.

Most of the system’s modules are already at the piloting stage and KRA is preparing for the launch. One of the most notable and immediate wins for KRA and the importers once the system is fully rolled out is reduced clearance time for goods. iCMS will enable Kenya to operate on world best practices in Customs management. Apart from enhanced efficiency, iCMS shall enable KRA to bring more revenue to the national revenue reserves.

Your Excellency Sir,

Another technological platform under Customs management which has transformed our operations is the Regional Electronic Cargo Tracking System abbreviated as RECTS. Since its launch in March 2017, KRA has realised significant benefits as far as transit cargo tracking and monitoring is concerned. Some years back, Kenya was grappling with the menace of cargo diversion and dumping which consequently led to substantive loss of government revenue through tax evasion. RECTS enables KRA and counterpart revenue administrations in Uganda and Rwanda to have a real-time view of cargo in transit and to ensure that the cargo gets safely to destination as per the transit documents.

With automation of key processes, including decisions on cargo valuation, KRA expects to see better revenue collection and more efficient trade facilitation.

KRA has elaborate revenue enhancement initiatives aimed at widening the scope of domestic taxes collection. That said, even after the launch of the simplified rental income programme, KRA has information that the number of landlords in our database does not reflect the actual number of landlords on the ground. With this in view, we target to recruit an additional 66,000 landlords by 2021. To achieve this, we shall rely on intelligence reports to identify non-compliant developers, use of third party data and block management in high density estates, among other strategic measures.

Other revenue enhancement measures under domestic taxes include enhanced debt programme and data driven compliance. We anticipate to collect additional Ksh 97 Billion in domestic taxes at the full implementation of the programme.

Your Excellency Sir,

Another key revenue growth driver will be the implementation of the 15 per cent presumptive tax which shall effectively replace the current turnover tax regime. I would like to thank the Cabinet Secretary of the National Treasury for this proposal in his Budget Statement in June. The significant number of small scale traders who were left out of the turnover tax bracket will now have a place to call home. Our target is to bring on board more than 1.56 million taxpayers with single business permits who were not included in the turnover tax regime. We are optimistic that introduction of presumptive taxes will increase revenue collection. To this end, I would like to urge all the concerned stakeholders ranging from traders to county governments and all policy makers at large to throw their full weight behind the implementation of this new tax regime.

In order to enhance our engagement and interaction with taxpayers, we have also invested in a modern customer relationship tool, the Customer Relationship Management (CRM) solution hosted at our contact centre. Through CRM, we now register an average of over 40,000 phone calls per month from taxpayers seeking various services. KRA also has a robust online presence on social media platforms with an average of over 95,000 interactions monthly.  We expect these figures to continue to grow especially after the full roll out of the system.     

There are a lot more long-term, medium-term and short-term key initiatives we have in place to better the tax administration in Kenya. Apart from use of technology, KRA is undergoing a robust transformation cycle at the moment which aims at enhancing operational efficiency as well as ensuring best industry standards. In a few years to come, we shall be looking at a completely different KRA. With enhanced operational efficiency as embedded in the ongoing transformation agenda, we are optimistic that the landscape of revenue mobilisation and collection in this country will be completely changed.

During the Taxpayers Month, we deliberated on a wide range of topics which include: expanding market access for revenue enhancement, accelerating growth competitiveness of the manufacturing sector as well as taxation in emerging sectors such as extractive and electronic commerce.

I believe that the deliberations made provided solutions for enhancing and supporting KRA’s role in Tax and Customs Administration to the Big Four Agenda.

 

Further, KRA has been considering introducing tax education in the Kenyan education system for a while. KRA and Kenya Institute of Curriculum Development (KICD) have therefore partnered to mainstream tax education in the Kenyan education system curriculum and KICD presented the report to KRA during the 4th Annual Tax Summit.

The report revealed that there is a 95 per cent need for incorporation of tax education in the new competency based curriculum in order to equip learners with requisite tax knowledge.

 

Your Excellency Sir,

As I conclude, I wish to congratulate all the taxpayers who are set to be awarded today. This country cannot thank you enough for your significant contribution. I also wish to urge all of us as taxpayers to uphold compliance at all times. As someone once said, the cost of being compliant is very cheap. The reverse is also true. To bring to a close my remarks I would like to reaffirm to all of you our commitment to taxpayer facilitation for purposes of continued cultivation of a culture of compliance among all of us.

I wish to thank you once again Your Excellency Sir, for gracing this event. I also thank the KRA Board and staff for their continued dedication to our call to duty

 

Thank you very much for your audience.

God bless you!               

J.K. Njiraini, CBS

COMMISSIONER GENERAL