Land lords pay Kenya Revenue Authority Sh10billion 'rent' in 16 months
The Tax man collects Sh400 million per month from the land lords.
This is after the introduction of Finance Act 2015, which requires land lords to pay taxes on earnings came into force, forcing the tax man to demand his due.
KRA announced that 52,000 landlords are already on their database since the law come into effect.
“We have partnered with other relevant government institutions such as Kenya Bureau of Statistics, Kenya Property Developers Association and the Ministry of Lands, Housing and Urban Development to be able get more landlords who are not in our data base. Our target is to recruit 20,000 new landlords in the financial year 2016/2017,” KRA manager in-charge of real estate Alice Kiptoo said.
This is slightly over 50 per cent of the initially targeted 100,000, but the state agency said it is proud of its achievements so far, adding it collects Sh400 million per month which translates to Sh4.8 billion per year.
Complex taxation system, poor record keeping, informal operations by players and a lack of awareness about the law are some of the bottlenecks still in place which need to be sorted out.
There are about 100,000 landlords in the country with about 80 per cent in Nairobi County according to data estimates from the KRA.
While the government stands to benefit from the land lords revenue, tenants however may have to contend with steep rents since the land lords may simply pass the cost to the consumer.
Ms. Kiptoo was speaking during a media sensitisation workshop on Rental Income and Capital Gains Tax at a Nairobi hotel.
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