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Wednesday, August 23, 2017

KRA nets a record Sh1.114tn in 11 months but misses target

Kenya Revenue Authority commissioner general John Njiraini appears before the National assembly Labour & Social Welfare to consider the Betting, Lotteries and Gaming (Amendment) Bill, 2016 on February 21,2017. /HEZRON NJOROGE
Kenya Revenue Authority commissioner general John Njiraini appears before the National assembly Labour & Social Welfare to consider the Betting, Lotteries and Gaming (Amendment) Bill, 2016 on February 21,2017. /HEZRON NJOROGE

Total tax collections in 11 months ended May 31 reached a record Sh1.114 trillion, official exchequer data shows, a growth of 12.77 per cent over Sh987.85 billion collected in the same period last year.

The Kenya Revenue Authority will, however, have to collect Sh153 billion this month to hit the revised full-year target of Sh1.267 trillion set by the National Treasury.

The taxman missed the Sh1.161 trillion target for 11 months on pro rata basis by 4.05 per cent, despite netting Sh124.06 billion in May since collections for the July-April period were Sh989.94 billion.

The Statement of Actual Revenue and Net Exchequer Issues, published by the Treasury CS Henry Rotich in the Kenya Gazette on Friday, shows that total government revenue between July 2016 and May 2017 hit Sh1.764 trillion.

That was a 9.98 per cent growth compared with Sh1.588 trillion a year ago.

The Treasury has a full-year revenue target of Sh2.054 trillion for 2016-17 – meaning the government will have to find some Sh290 billion this month to hit the target, having missed it by 6.27 per cent in 11 months ended May 31.

Tax collections accounted for 63.15 per cent of the total revenue generated by the government in the review period.

Non-tax income rose by 24.70 per cent year-on-year in the 11 months to Sh41.90 billion, but hugely under-performed a target of Sh95.61 billion on a pro-rated basis, given the full-year target of 104.30 billion.

Commercial loans to the government surpassed the revised Sh186.04 billion target for 12 months to stand at Sh186.30 billion in 11 months ended May 31 – Sh111.97 billion more than the Sh74.33 billion borrowed the year before. The target was revised upwards from Sh153.78 billion in the printed budgetary estimates.

“Following Kenya’s elevation to lower middle income economy status in September 2014, recourse to borrowing on commercial and semi-concessional terms has increased while that on concessional terms has declined,” the Central Bank of Kenya said in the quarterly Economic Review for October-December released on April 18.

Net domestic debt was Sh312.01 billion in the review period, 19.65 per cent shot of the Sh388.34 billion on a pro rata basis which reflects the decision by the CBK to reject “expensive” debt offers.

The full-year target from domestic borrowing is Sh423.65 billion.

Grants from the peacekeeping African Union Mission in Somalia rose by 21.44 per cent to Sh5.21 billion from Sh4.29 billion the year before. The Treasury targets Sh6.44 billion from Amisom by end of the month.

Other sources of revenue included loans from foreign governments and international organisations at Sh24.93 billion, 10.06 per cent more than Sh22.65 billion last year.

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