TIGHT MEASURES

Cargo scanning, tracking boosts KRA's collection by 18%

Treasury data shows half-year tax collection closed at Sh857.8 billion, a growth compared to Sh722.3 billion in December 2018.

In Summary

•KRA says its Integrated Scanner Command Centre and the Regional Electronic Cargo Tracking System (RECTS) have helped curb cargo diversion, misdeclaration and illicit trade.

•World Customs Organisation (WCO) Secretary-General Kunio Mikuriya has called for continued investments in technology to man borders and support trade.

World Customs Organisation Secretary-General Kunio Mikuriya with KRA commissioner for Customs and Border Control Kevin Safari at the Integrated Scanner Command Centre, Times Tower-Nairobi, on February 3.
World Customs Organisation Secretary-General Kunio Mikuriya with KRA commissioner for Customs and Border Control Kevin Safari at the Integrated Scanner Command Centre, Times Tower-Nairobi, on February 3.
Image: FREDRICK OMONDI

Investment in cargo scanning and tracking has helped curb diversion, mis-declaration and illicit trade boosting revenues by 18.8 per cent, according to Kenya Revenue Authority.

This follows the successful implementation of the Integrated Scanner Command Centre (ISCC) and the Regional Electronic Cargo Tracking System (RECTS), all with a central command center at Times Tower, Nairobi.

Latest official Treasury data shows half-year tax collection (July-December) closed at Sh857.8 billion, a 18.8 per cent growth compared to Sh722.3 billion in December 2018.

 
 

The two systems, which have been lauded by the World Customs Organisation (WCO), have reduced cargo verification at ports of entry from 60 per cent to below 10 per cent, increasing clearance processes and cargo dwell time along the Northern Corridor.

“In terms of tax evasion, cargo scanning systems have addressed that, and we have seen especially ethanol which was being smuggled in large quantities being arrested at the scanners,” Commissioner for Customs and Border Control Kevin Safari said yesterday.

He spoke during a tour of the centre by the World Customs Organisation (WCO) Secretary-General Kunio Mikuriya , who is in the country on a two-day visit.

WCO has provided capacity building and technical support to KRA as it moves to implement modern technology to address Non-Tariff Barriers to trade, curb illicit trade and easing movement of goods across borders.

Mikuriya said Kenya plays a critical  critical part in the implementation of smart borders in the region and called for continued investments in technology for border surveillance  not only in the region but the continent, which is moving towards the African Continental Free Trade Area.

“What I see here is the materialisation of smart borders. Africa is moving towards a free trade area and customs are always a driving power. The use of modern and latest technology is very important to move forward as one big market,” Mikuriya said.

“Kenya's progress is contingent, influencing other countries' customs operations, therefore Kenya's customs progress is key,” he said.

 

KRA has at least 20 scanners in key entry and exit points in the country.

They include three fixed scanners at the Port of Mombasa, one mobile scanner and rail scanner at the port and four drive-through scanners at the Inland Container Deport-Nairobi ( ICDN).

There are at least 10 baggage scanners at One Stop Border Posts, Jomo Kenyatta International Airport and Moi International Airport(Mombasa), specifically dedicated for cargo.

Last year, the authority intercepted contraband worth more than Sh400 million at the port of Mombasa and ICD, which included high-end vehicles suspected to had been stolen from the UK and UAE among other commodities.

The Kenya Association of Manufacturers estimates the country has been losing  over $42 million (Sh 4.2 billion) annually to illicit trade and approximately $80 million  (Sh8.04 billion) in government revenue.

Government on the other side estimates it has been losing over Sh30 billion revenue annually as a result of tax evasion, counterfeiting and unlicensed products.

Before the tracking system, more than Sh1 billion revenue would be lost annually in illegal fuel trade on the highway between Gilgil-Nakuru, Eldoret-Bungoma and Malaba.