A state-backed bill sponsored by Majority leader Kimani Ichung’wah seeks to delete the provision of the law that made the board the new power hub.
The KRA (Amendment) Bill, (No2), 2024, intends to hand back the powers to the KRA commissioner general.
The government wants the commissioner general of KRA to enjoy exclusive powers to appoint deputy commissioners without the board's interference.
“The commissioner general shall appoint such deputy commissioners as may be deemed necessary,” the bill reads.
Section 13 of the KRA Act provides that the board shall appoint the commissioners and other officers.
The existing law provides that the board appoints commissioners and deputy commissioners – as may be deemed necessary.
The commissioner general is thus to appoint all other members of staff “as may be required by the authority for efficient performance of its functions”.
As part of the top brass, deputy commissioners attend board meetings in the absence of commissioners – only that they don’t vote.
KRA commissioner general was stripped of the powers to appoint senior officers and department heads in the Finance Bill, 2023.
This sparked concerns that the commissioner general is the accounting officer and CEO yet he has no powers to appoint top staff.
Busia Senator Okiya Omtatah successfully challenged the tax law in court recently and the same was declared unconstitutional.
Court of Appeal judges Kathurima M'Inoti, Agnes Kalekye Murgo and John Mativo ruled that the Finance Act 2023 was fundamentally flawed and therefore void.
The drawdown of board powers was also proposed in the Finance Act 2024, which was since withdrawn following protests.
The National Assembly Finance Committee had proposed to amend the Kenya Revenue Authority Act as part of the amendments to the Finance Bill, 2024.
KRA has seven commissioners — Customs and Border Control, Legal Services and Board Coordination, Strategy, Innovation and Risk Management and Domestic Taxes.
Others are Intelligence, Strategic Operations, Investigations and Enforcement, Kenya School of Revenue Administration and the Corporate Support Services department.
Should MPs approve the bill, the balance of power would shift back to the commissioner general from the board.
Currently, the Antony Mwaura-led team has absolute say in KRA management, with the commissioner general only left to appoint junior members of staff.
A number of MPs protested when the current law was introduced and argued that it was wrong to change the structure of KRA through the Finance Act.
The lawmakers argued that Mwongozo - Code of Governance for State Corporations, which was used as a basis is not a law, hence defeated the principle behind the law change.
According to Mwongozo, day-to-day management of state organisations rests with the chief executive officer.
MPs said the Finance Bill, being a miscellaneous amendment bill touching on many Acts, was not the best route.
“If you are doing a substantive thing of changing the board of directors, it is not proper to use such a bill,” Seme MP James Nyikal said.
The proposed law further seeks to give the Treasury boss power to waive penalty payable by an agent who fails to transfer funds collected on time.
This would be if the failure is inadvertent or the person has been out under receivership or statutory management.
“The Cabinet secretary may waive part or the whole of the penalty due where the person has transferred the funds to the Central Bank in full.”
This would be when the failure is as a result of system downtime that prevented the transfer of funds and the same reported to KRA.
Defaulting agents would also be spared if the failure to transfer the funds was not due to negligence by the person or when there is a disaster.
KRA is also being allowed to collaborate with other training institutions in the country to provide courses on revenue administration.
