KRA embarks on tax base expansion programmes to raise more revenue

The Kenya Revenue Authority (KRA) is in the process of rolling out an elaborate tax base expansion programme aimed at yielding more than Sh60 billion in the current financial year.

The programme targets to recruit over 500,000 new taxpayers who have been out of the tax bracket.

Speaking during the launch of the 2018 Taxpayers? Month on 1st October, 2018 at KRA headquarters in Nairobi, KRA Commissioner General John Njiraini said that the programme seeks to identify Kenyans involved in gainful business who ought to be paying taxes but they are not.

Mr Njiraini indicated that the tax base expansion strategy targets to acquire information for tax base expansion purposes through access to key databases in both the private and public sectors.

?Data obtained in this manner is thereafter utilised to assess the compliance status of the taxpayers identified, with appropriate action then being taken to assure their compliance,? Mr Njiraini said.

Mr Njiraini further said that some of the databases KRA has targeted in the first stages include those on mobile money payments and those maintained by regulatory and professional bodies.

?We are also sourcing data from major private players including key public infrastructure contractors and hospitality service providers including major hospitals,? he noted.

In a bid to enhance service delivery in tax administration, the Commissioner General observed that KRA has been leveraging on modern technology in the past few years. Some of the technologies which he said have transformed the way the tax agency works include the popular iTax platform, the Customer Relationship Management Solution (CRMS) and the Regional Cargo Tracking System (RECTS) among others.

?We have also through technology investments sought to provide taxpayers with easy mechanisms for tax payment and accessing KRA services. Our iTax system which is now in its 4th year has eliminated major bottlenecks that taxpayers used to endure while interacting with KRA,? Mr Njiraini said.

He added that as KRA marks the taxpayers? month this year, the agency will launch more key technological initiatives geared towards improving customer service delivery which include the introduction of scanners at the JKIA passenger arrivals terminal.

?The introduction of passage baggage scanning at JKIA is an important milestone that will greatly help in addressing customer concerns about previous haphazard stripping of passenger personal effects,? he said adding that a similar approach is being adopted at Moi International Airport in Mombasa and at key border entry points such as Namanga, Malaba and Busia.

The introduction of scanner technology at key entries, Mr Njiraini said, will not only improve both Customs detection capacity but also remove inconveniences for arriving passengers.

In order to provide transparency in the resolution of disputes, KRA has restructured its dispute resolution processes. The restructuring, according to Mr Njiraini, has been realised through the revamped Alternative Dispute Resolution (ADR) programme.

?Our revamped ADR framework will provide taxpayers with credible, transparent and customer friendly process that removes perception about unfairness and underhand dealings in the resolution of tax disputes,? Mr Njiraini said.

He added that the new framework will also provide standardisation in the approach to dispute resolution besides ensuring speedy resolutions. KRA hopes to substantially reduce the number of tax disputes finding their way into the judicial system and at the same time resolve at least 80 per cent of tax disputes internally.

Speaking at the same event, National Treasury Cabinet Secretary Henry Rotich reaffirmed the government?s commitment in enhancing tax compliance and expanding the tax base. He said that the government has over the years initiated a number of reforms both legal and administrative targeting the expansion of the tax base as well as enhancing tax compliance.

?One of the key reforms is the passing of appropriate tax legislations aimed at simplifying and modernising our tax laws. In this pursuit, most of the tax statutes have been reviewed,? he said.

Mr Rotich, who was the chief guest at the launch, noted that the government has already simplified and modernised the Value Added Tax (VAT), Tax Procedures and Tax Appeals Tribunal legislations as well as having a fully operational Excise Tax Act.

The CS further revealed that the process of overhauling the Income Tax Act is underway. In this regard, he said that the Attorney General is already preparing a draft Income Tax Bill after undergoing public participation in accordance with the Constitutional requirement.

Mr Rotich indicated that review of the Income Tax Act was informed by the need to simplify and modernise the Act, expand the tax base as well as incorporate international taxation principles including transfer pricing.

Additionally, the CS noted that his ministry in partnership with KRA has enhanced use of technology as a key driver in the improvement of tax administration and collection.

?Kenya is among the first countries in the world to aggressively build an IT ecosystem in order to ease tax administration while at the same time enable taxpayers to comply. Use of technology has facilitated the collection and assessment of taxpayer data, enabling quick and targeted responses to taxpayers for enhanced compliance,? Mr Rotich said.

During the same event, KRA unveiled the former Chief Justice Dr Willy Mutunga as the KRA Tax Ambassador. The launch of the 2018 Taxpayers? Month also saw KRA launch its new look website which aims at refining and broadening the agency?s interactions with citizens to improve customer experience.

The Taxpayers? Month is an annual fete observed by KRA in October with the aim of celebrating tax compliant taxpayers from all parts of the country. KRA marks the month through various activities such as visiting selected taxpayers, corporate social responsibility initiatives, a tax summit and a presidential launch at the end of the month where distinguished taxpayers are awarded. This year?s fete is anchored on the theme ?expanding the tax base to enable the big four agenda.


NEWS 12/10/2018


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KRA embarks on tax base expansion programmes to raise more revenue