KRA collects Sh3.4b from tax amnesty in new drive
Kenya Revenue Authority (KRA) has successfully collected Sh3.4 billion in revenue through its tax amnesty programme, just over a month after its launch on September 1st, 2023.
The figures released by the tax authority yesterday indicate an average daily collection of Sh72.3 million, providing a glimpse into the programme’s efficacy in encouraging tax compliance.
The tax amnesty initiative aims to provide relief to taxpayers burdened with penalties and interest obligations. A notable revelation is that out of the approximately 7.0 million taxpayers in Kenya, a staggering 2.8 million, or 40 per cent, have penalties and interest that make them eligible for the amnesty.
The programme’s success can be gauged by the fact that 17,000 taxpayers have already applied, contributing to the Sh3.4 billion collection. This robust response indicates a significant uptake among individuals and businesses seeking to regularize their tax affairs and benefit from reduced penalties.
“More than 17,000 tax payers have applied for amnesty and we expect the number to immensely grow as we continue to create awareness among tax payers,” said chief manager domestic taxes Caroline Rotich.
Based on the current collection rate, it is projected that achieving the targeted Sh51.0 billion in revenue would take approximately 705 days, or nearly two years. This highlights the program’s potential not only to meet but potentially surpass its objectives if the current momentum persists.
The funds collected through the amnesty are expected to have a wide-ranging impact, assisting in strengthening the government’s fiscal position and potentially funding critical projects. The program’s success also underscores the effectiveness of targeted policies designed to incentivize tax compliance and foster a culture of financial responsibility.
The amnesty, which enables taxpayers to settle their outstanding tax obligations without incurring additional penalties and interest, has proven to be a lifeline for many struggling businesses and individuals grappling with economic challenges exacerbated by the global pandemic.
Furthermore, the Sh10.5 billion set aside for proceeds from the amnesty signifies a substantial financial injection into the government’s coffers. These funds can play a pivotal role in addressing budgetary requirements and enhancing the country’s economic resilience.
The KRA’s achievement of Sh3.4 billion within the first month underscores the programme’s potential as an alternative that is set to reshape Kenya’s tax landscape significantly.
As more taxpayers take advantage of the amnesty, the revenue authority not only recovers outstanding dues but also fosters a more compliant and transparent tax environment.
The KRA has emphasised that the positive response from taxpayers reflects a willingness to participate in the government’s efforts to build a sustainable and robust financial ecosystem, ultimately contributing to the nation’s economic growth and development.
taxman has also deployed 1,400 Revenue Service Assistants to support in iTax issues and the registration of unregistered trading businesses.
These assistants will assist clients in updating their iTax profiles and verifying information like location and contact details.\
The move is part of KRA’s efforts to provide services to taxpayers across the country, enhance productivity, and create a more taxpayer-friendly environment.
The Field Officers have undergone training to handle tax-related processes and align with KRA’s core values.
This initiative comes as KRA faces the task of raising Sh2.8 trillion in the 2023-24 financial year to fund President William Ruto’s Bottom-Up Economic Transformation Agenda (BETA).