QUERRY

KRA faulted over Sh126m uncollected rent, unregistered lands

Auditor General Nancy Gathungu pokes holes on Taxman's declaration of assets without factoring lands without title deeds

In Summary

•The amount is less the Sh166 million the taxman declared as rental income for the financial year ending June 2019.

KRA headquarters.
KRA headquarters.
Image: FILE

The Kenya Revenue Authority has been cited for failing to collect Sh126 million rent from its various housing units across the country.

Auditor General Nancy Gathungu, in her latest report details how the taxman failed to collect Sh84 million from its houses in Miritini and Sh27 million from premises in Kizingo in Mombasa county.

The taxman is also yet to collect over Sh11 million from tenants at Robert Ouko Estate, Kisumu and another Sh2 million from tenants at Soweto, Miritini I, Migadini, Miritini II, Buxton, Nyerere, and Changamwe.

The amount is less the Sh166 million the taxman declared as rental income for the financial year ending June 2019.

Gathungu said the situation may remain the same with management attributing the non-collection to disputes in ownership of land.

The authority, the auditor said, is seeking the approval of the board of directors for engagement of an inter-ministerial committee to solve the ownership disputes.

“Under the circumstances, the completeness and accuracy of the rental income balance of Sh166 million as of June 2019 could not be ascertained,” Gathungu says.

The auditor added that the taxman’s asset base could not be established following the lack of title deeds of some 14 parcels of leasehold land.

The properties valued at about Sh1 billion are said to be at various stages of registration by the National Land Commission.

Gathungu notes there is danger in the fact that the issue of title documents have been outstanding for a long period of time.

The plots include a 0.3 hectare parcel with residential flats at Kisumu’s Robert Ouko estate; an 8 hectare plot at Lwakhakha border post; 4.2 hectares at Malaba – housing an office block and staff canteen; 0.25 hectare that houses the Namanga Border post office block; and 0.6 hectares at Mombasa KRA Training Institute.

Also at risk are parcels of 13.2 hectares at KRA training institute Mombasa; 9.6 hectares which has 20 residential houses at Bamburi; 0.16 hectares which houses the Kizingo plots; 0.4 hectares in Mtwapa; 0.05 hectares which houses Kilifi office block and residential houses; four hectares at Horohoro; four hectares at Namanga; 2.6 hectares in Kisumu; and 0.4 hectares at the Busia border post.

Gathugu further flagged five plots in Waji, Garissa, and Mandera counties which have not been valued, all proposed sites for one-stop border point.

There are seven acres at Diff in Wajir; 1.3 acres at Gerille – also Wajir; 7.6 acres at Amuma – Garissa; 1.3 acres at Halugho; and 30 acres at Elwak.

“In the absence of the title documents, it has not been possible to ascertain that all the properties and improvements thereon belong to the authority,” Gathungu says.

This, therefore, brings to doubt the balance of property, plant, and equipment of Sh30.8 billion as declared by the taxman in the financial year ending June 2019.