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KRA swiftly responds as Kenyans share tax avoidance tactics

KRA's surprise reaction after Kenyans listed tax avoidance tricks

KRA Commissioner General Humphrey Wattanga

In a digital age where information spreads like wildfire, a simple social media post can ignite discussions on a broad spectrum of topics.

One such post by a Kenyan Twitter user, @polo_kimanii, on October 26 set the stage for a debate on tax avoidance.

His claim that there are legal loopholes allowing individuals to evade taxes sparked a wave of responses from netizens, prompting a reaction from the Kenya Revenue Authority (KRA).

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@polo_kimanii's Twitter post raised eyebrows when he invited his followers to share their knowledge of tax avoidance tricks, asserting that these practices were not illegal.

He argued that Kenya's constitution contains certain ambiguities that many people are unaware of, providing opportunities for individuals to legally evade taxes.

He cited Article 13.2 of the Persons with Disabilities (PWD) Act, which states that individuals with disabilities are entitled to tax exemption from KRA.

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According to his suggestion, if someone has a PWD relative who is not engaged in any income-generating activity, they could open a business in the relative's name. This way, the business owner could enjoy tax benefits, while the relative receives financial support.

The post quickly gained traction, and other netizens joined the conversation by sharing their perceived tax avoidance methods.

Here are some of the tax avoidance tricks X users shared

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Eddy Rhodium Pay yourself as director salaries in the form of expenses. Eg, purchase your vehicle register under the company. Make a separate company that offers services to your company. E.g. Hr. services to yourself from the HR department. Withholding is cheap. Do illegal business with gava.

Man U Diehard Another way to legally avoid tax. Did you know any payments under 24K are exempted from withholding tax? So kama uko na client na umemlipisha let's say 50K. Just split the 50K into say 3 times and invoice the client under different job subjects

Two N word Niliona wahindi wanabuy land wanajenga then wanna register company ya kurent hizo nyumba, then anarent hiyo warehouse for his business, then kila mwezi anajipa rent,huwa wanamake sure expenses ziko juu,hadi wanaleta garbage from mosque ndio ikuwe collected under the company, expenses zako zikikuwa mob tax inashuka. Kulipa wafanyakazi in cash ni another way ya kucontrol damage pia.

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The Kenya Revenue Authority could not remain a passive observer as this tax debate unfolded.

In response to the initial tweet, KRA expressed its astonishment and disapproval with a GIF featuring American media personality Steve Harvey.

The government agency was taken aback by the online conversation, and this reaction signaled its disbelief at the willingness of some Kenyans to engage in tax avoidance practices.

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