KRA SUSTAINS UPWARD REVENUE TRAJECTORY IN QUARTER 2

Kenya Revenue Authority (KRA) collected Kshs.154.383 Billion in the month of October 2021 against a target of Kshs.142.285 Billion, recording an impressive performance of 108.5% and a growth of 23.2%, sustaining positive performance into Quarter Two of the Financial Year 2021/22.

 

KRA commenced the new financial year on an upward trajectory after surpassing its (July-September 2021) target of Kshs.461.653 Billion by Kshs. 15.053 Billion, recording a 30.0% growth.

 

This implies that cumulatively KRA realized collections of Kshs.631.090 billion for the period July - October 2021 against a target of Kshs.603.939 billion, translating to a performance rate of 104.5%, a growth of 28.3% and a surplus of Ksh. 27 billion.

 

During the month under review, Customs & Border Control (C&BC) exhibited an excellent performance after collecting Kshs.57.374 Billion against a set target of Kshs.51.200 Billion reflecting a performance rate of 112.1 per cent and a surplus of Ksh.6 Billion.

 

Domestic Taxes recorded a performance rate of 106.5 per cent with a collection of Kshs.96.616 Billion against a target of Kshs.90.700 Billion recording a surplus of Ksh. 5.9 Billion. PAYE registered a collection of Kshs.37.001 Billion against a target of Kshs.36.462 Billion registering a performance of 101.5%.

 

The sustained strong performance is a reflection of the improving global economic environment as well as the implementation of revenue enhancement initiatives by the Authority. The African Development Bank (AfDB) projects that the East African Economy will grow by 4.1 per cent in 2021 from 0.4 per cent in 2020. The Gross Domestic Product is expected to grow by 5.3% in FY 2021/22 as per 2021 Budget Policy Statement.

 

The improved performance is further anchored on implementation of key strategies as espoused in the 8th Corporate Plan including:

  1. Tax base expansion which focuses on bringing citizens and business previously not paying taxes into the tax net.
  2. Enhanced compliance efforts which focuses on ensuring taxpayers file returns and pay correct taxes.
  3. Addressing tax evasion and illicit trade which focuses on ensuring businesses whose profitability model is based on tax evasion are investigated and taxes recovered.
  4. Extensive use of data and intelligence to unearth unpaid taxes.
  5. Taxpayer support programs including taxpayers’ education and constant engagements to address taxpayers concerns as well as alternative dispute resolution. Currently, there are over 570 tax disputes tied up in Courts with tax assessments of 150 Billion.
  6. Simplification of tax processes through use of technology.
  7. Collaboration with other Government Agencies under the whole of Government approach in the fight against economic crimes.

 

Kenya’s tax to Gross Domestic Product ratio currently stands at 13.8%, indicating the need to continue enhancing tax collection and reducing tax expenditure in the form of exemptions and incentives to achieve the desired rate of over 20%.

Kenya’s tax gap remains high (45% for VAT as reported by IMF in 2017). Indicating the need to sustain our tax base expansion efforts and upscaling of the fight against tax evasion and illicit trade. 

The Authority is optimistic that sustained compliance efforts will continue to yield positive outcomes for the country.

Tulipe Ushuru, Tujitegeme

COMMISSIONER GENERAL


PRESS RELEASE 08/11/2021


Did you find this content useful?

Average Rating

💬
KRA SUSTAINS UPWARD REVENUE TRAJECTORY IN QUARTER 2