•Speaking during a media sensitization on the new system on Monday, chief manager Domestic Taxes KRA, Hakamba Wangwe said all VAT registered taxpayers have until July 31 to upgraded to the new system.
•The authority is optimistic that the electronic tax invoice will minimize Value Added Tax (VAT) fraud, which will in turn increase tax revenue.
Image: COURTESY
Kenya Revenue Authority is counting on its new Tax Invoice Management System (Tims) to increase VAT collection by 30 per cent this financial year.
The authority is optimistic that the electronic tax invoice will minimize Value Added Tax (VAT) fraud, which will in turn increase tax revenue.
According to the taxman, Tims will standardize and authenticate tax invoices from the time of generation by the trader to transmission to KRA on a real time basis.
Speaking during a media sensitization on the new system on Monday, chief manager Domestic Taxes KRA, Hakamba Wangwe said all VAT registered taxpayers have until July 31 to upgraded to the new system.
"25 per cent of our large and medium taxpayers, who account to 70 per cent of tax revenue have already come on board as we wait for the rest to make progress," Wangwe said.
Latest National Treasury data shows KRA could surpass its revenue collection for the first time in more than five years.
The tax collector is currently at 93.6 per cent target, a month to the end of the 2021/22 financial year, according to the latest Statement of Actual Revenues and Exchequer Issues by the National Treasury.
The data shows KRA had collected Sh1.63 trillion by end of May, Sh110 billion shy of a revised collection target of Sh1.74 trillion.
The initial target was Sh1.707 trillion but this was revised to factor in subsequent supplementary budgets.
The agency has on average been collecting monthly more than Sh100 billion monthly this year.
In January, the taxman said its Value Added Tax collections amounted to Sh121 billion against a target of Sh119.543 billion, resulting in a surplus of Sh1.501 billion and recording a growth of 40.2 per cent.
"The good performance was primarily attributable to enhanced compliance efforts by the authority and economic recovery," the taxman noted.
From August to December, corporation tax collection stood at Sh107.4 billion which is a growth of 17.3 per cent over the half-year.
The data shows Kenya Revenue Authority (KRA) had collected Sh1.63 trillion by end of May, Sh110 billion shy of a revised collection target of Sh1.74 trillion.
The initial target was Sh1.707 trillion but this was revised to factor in subsequent supplementary budgets.
The agency has on average been collecting monthly more than Sh100 billion monthly this year.
The revenue agency came close to hitting its annual tax target in the year ending June 2021 when it missed the mark by just Sh16.8 billion.
According to National Treasury data, the agency raised Sh1.562 trillion in 12 months from July last year.
This was against a target of Sh1.579 trillion as per revised budget estimates covering the period to June this year.
Even so, the collection represented a much-improved performance, 98.9 per cent of the total target compared 97.4 per cent a year prior.
Last week, KRA Commissioner General Githii Mburu said his agency has exceeded two upward revenue target revisions brought in through supplementary budgets, pointing to the enhanced tax enforcement and recovery measures the taxman has been implementing in the period.
Kenya recovered close to Sh1 billion in revenue following an Exchange on Information deal on tax cheats with other African countries last year.
The Tax Transparency in Africa 2022 report shows KRA netted the amount through the Exchange on Information (EOI) unit established in 2014.
''KRA sent 173 requests last year to members of the forum which aided the netting of additional revenue,'' the report reads in part.
Kenya has also seen an increase in EOI requests, from just one in 2018 to 17 in 2019, and 73 in 2020.
According to the report, Kenya realised revenues amounting to Sh130 million in 2019 and Sh10.5 million in 2020.