Feb 15th 2021- Kenya Revenue Authority has vowed to continue escalating its fight against tax evasion and leverage on technology to support tax collection. This is followed by the tax collection report on income and value added tax dropping by kshs 90.66 billion in the first half of the year to moderate reliefs at the back of COVID-19 shocks.
KRA received Sh488.31 billion from taxing business earnings and workers’ pay as well as supply of goods and services (VAT) in six months through December 2020, a 15.66 percent drop compared with Sh578.97 billion in a similar period a year earlier.
Commissioner General Githii Mburu in a statement said, they are focusing on trade facilitation and enhanced compliance through implementation of post clearance audits and review of the end use of exempt products. He added that the measures will play a critical role in maintaining revenue performance.
Fresh statistics shared by the Central Bank of Kenya show how broad tax categories were impacted by the economic fallout emanating from Covid-19 containment measures indicating the income tax streams were the hardest hit, falling Sh58.19 billion followed by VAT at Sh32.47 billion.
Income tax receipts for July-December 2020 period amounted to Sh309.24 billion, a 15.84 percent drop compared with Sh367.43 billion in a similar period a year earlier, according to data for the National Treasury.
Besides reduction of maximum income tax to 25 from 30 percent as part of the tax reliefs between May and December 2020, levies on business profits and salaries were largely weighed down by depressed corporate sales.
KRA are also keen to continue building up compliance enforcement efforts by driving the implementation of the new tax measures.