KRA Misses Revenue Target By Ksh 32.2 Billion


KRA Misses Revenue Target By Ksh 32.2 Billion

By Jane Muia / Published January 12, 2023 | 11:26 am

KEY POINTS

Income tax was the worst performing, recording a shortcut of 30.4 billion shillings. Income taxes comprise taxes on employees’ salaries and profits earned by companies. KRA collected a total of 342.5 billion shillings against the target of 372.9 billion shillings con high compensating light shillings .

KEY TAKEAWAYS

According to the taxman, the positive revenue growth rate was helped by the improved tax compliance from patriotic taxpayers who contributed to the collection of a revenue surplus of 148.9 Billion shillings.

The taxman is expected to collect at least 173 million shillings every month as it targets to collect a total of 2.07 trillion shillings in the current financial year.

The Kenya Revenue Authority (KRA) missed the revenue collection target for July-November last year by 32.2 billion shillings, a presentation by Treasury PS Chris Kirwa shows.

During the period, the taxman collected 786.5 billion shillings in taxes against the target of 818.7 billion shillings that had been set by the National Treasury for the period.

Income tax was the worst performing, recording a shortcut of 30.4 billion shillings. Income taxes comprise taxes on employees’ salaries and profits earned by companies. KRA collected a total of 342.5 billion shillings against the target of 372.9 billion shillings con high compensating light shillings .

Other Income Tax, where corporate income tax paid by firms falls, recorded a shortcut of 17.6 billion shillings with KRA collecting 153.6 billion shillings compared to a target of 171.2 billion shillings.

Meanwhile, pay-as-you-earn, which is paid by employees, dipped by 12.8 billion shillings with the taxman collecting 188.9 billion shillings from workers from a target of 201.7 billion shillings.

“In the first five months of FY2022/23 total revenue performance was below target by Sh19 billion, with ordinary revenue recording a shortcut of Sh32.2 billion,” Kiptoo said on Wednesday during the public hearings on the budget for Financial Year 2023/24 .

The underperformance will put KRA under pressure in meeting the financial year’s target. In the last financial year, the taxman surpassed the 2 trillion mark in the annual revenue collection for the first time in Kenya’s history.

This was despite economic uncertainties occasioned by the covid 19 pandemic. It recorded a monumental revenue collection of 2.031 Trillion shillings for the Financial Year 2021/2022 (July 2021 – June 2022) compared to 1.669 Trillion shillings collected in a similar period in the previous financial year.

According to the taxman, the positive revenue growth rate was helped by the improved tax compliance from patriotic taxpayers who contributed to the collection of a revenue surplus of 148.9 Billion shillings.

The taxman is expected to collect at least 173 million shillings every month as it targets to collect a total of 2.07 trillion shillings in the current financial year.

KRA has been betting on digitization and improved compliance from taxpayers to raise nettings from taxes. The taxman has continued to employ technological strategies to assist seal revenue loopholes. One of the strategies KRA has employed is the web-based system, iWhistle. the public to unanimously report corruption.

This has enabled the authority to gather corruption and tax evasion-related information from the public while concealing the anonymity of the reporters. The authority is currently rolling out the Tax Invoice Management System (TIMS), which aims at plugging loopholes resulting from weaknesses in the ETR regime.

The system will help in the standardization and authentication of tax invoices at the time of generation by the trader and transmission to KRA on a real-time or near-real-time basis.

Related Content: KRA Collected 789.3 Billion Shillings In November

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