KRA posts growth despite harsh times

April 19, 2013

, KRA-HQSNAIROBI, Kenya, Apr 19 – The Kenya Revenue Authority (KRA) achieved revenue growth of 12.4 percent, collecting Sh560.4 billion for the first nine months of the current fiscal year, up from Sh498 billion collected in 2011/2012.

Despite an unfavourable economic operating environment, KRA expects to grow as a result of continued interventions to address loopholes and as business activities pick up following the conclusion of the elections.

The figures were still below the expected 25 percent growth in revenue collections. However, as KRA Commissioner General John Njiraini noted, they are unlikely to collect the targeted 881 billion shillings in the current fiscal year announced my former Finance Minister Njeru Githae during the budget statement last June.

Njiraini explained that the dip in growth is due to a slowdown in the economy during the electioneering period as well as delay in enacting the VAT Bill.

In the period between January and March this year, KRA netted Sh179 billion with the collections being negatively affected by the electioneering period, which has spilled into the current quarter.

Njiraini added that the issue of tax evasion has seen the tax authority identify six large taxpayers who are currently under investigation as well as the introduction of new secure excise duty stamps for cigarettes, wines and spirits.

He said that the general election period negatively affected operations especially for international trade taxes, with February and March registering growth of 8.4 percent, while declining by 13.4pc for customs compared to 22.9pc achieved in January 2013.

“During March, customs operated for 19 days compared to 22 days in the previous year, with some of the working days during the election period recording minimal activity,” he explained.

The Commissioner General revealed that KRA plans to recruit 300 staff over the next three years to implement a track and trace system to curb counterfeit excise duty stamps.

He added that plans are already underway to simplify tax declaration and payment.

On rental income tax, KRA collected Sh453 million and Njiriani said that the delay in enacting the VAT Bill has led to revenue losses of Sh11 billion.

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