The Kenya Revenue Authority (KRA) is expected to double current revenue collection to at least Ksh 4 trillion within the next five years.
Speaking during the National Taxpayers Week, President Ruto directed the authority to leverage on technology and broaden the tax base by ensuring every Kenyan with a national identity has a KRA Personal Identification Number (PIN).
“The consequences are painful to contemplate. Our GDP has risen to Ksh 12 trillion, yet KRA only raised about 14% of it in revenues last year. In the past KRA was able to raise 18% of GDP. If we collect the same target today then would have raised an extra Ksh 400 billion. I expect KRA to raise 3 trillion by the end of the next financial year and to double the current collection in five years,” said President Ruto.
In the financial year 2021/22, KRA collected a historic Ksh 2.03 trillion in revenue which was an improvement when compared to Ksh 1.67 trillion the authority collected in FY2020/21.
KRA which has been seen as deploying aggressive tax collection mechanisms which has been detrimental to survival of many businesses.
“Our work as public officials is to support and facilitate business. Public officials have no business standing in the way of business, being a hindrance, creating roadblocks. Their work is to support and facilitate business,” added Deputy President Rigathi Gachagua.
The President reforms which will be deployed by his administration will ensure KRA maximizes tax collection while minimizing the compliance burden on the taxpayer trough comprehensive culture change to make it people-friendly, customer-centric organisation.
“KRA must also reflect equity by shifting from the over-taxing of trade and under-taxing of wealth, to enable the wealthy bear an appropriate burden. As I have said before, our operating philosophy in matters revenue mobilisationis going to be hierarchical. This means that we shall tax wealth, consumption, income and trade in that strict order,” said the President.
Issuance of PINs to all those with IDs is expected to boost the tax base from the current 7 million with adoption of technology.
“Every Kenyan with an ID should have a PIN number. Technology, and a considerate, fair and professional mobilisation will do the job quite well. Safaricom, a telco, has registered more people than KRA, a powerful state organisation. It is very clear that the magic lies in technology and strategy, not power and resources,” he added.
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