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KRA clarifies reports of revenue shortfall amid cash crunch at Treasury

KRA issued a statement clarifying claims of revenue shortfall amid cash crunch at Treasury

KRA acting Commissioner General Rispah Simiyu

KRA has responded to the cash crunch that has befallen the government, occassioning the delay in payment of salaries to civil service.

In the announcement on Monday evening April 11, KRA clarified that it has invested in modern technology to efficiently collect and settle revenue from source to the Exchequer.

The KRA further stated that its surveillance measures leave little room for revenue diversion.

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As of March 2023, the KRA has maintained a consistent pace of revenue collection compared to prior years, with revenue collection averaging 95.1% on the original target and 93.4% on the Supplementary target.

This represents a collection of Sh1.554 trillion and a year-on-year growth of 8%.

In a bid to bridge the deficit in target revenue collection, KRA said it continues to implement Revenue Enhancement Initiatives (REI) such as the roll-out of eTIMS, an initiative aimed at improving Value-Added Tax (VAT) collection.

In the statement, KRA also said it has integrated its systems with betting companies to improve the collection of Excise Tax on betting and Withholding Tax on winnings.

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The taxman also plans to expand the tax base, bringing more taxpayers into the tax bracket.

In line with its commitment to improving tax administration, KRA emphasized its commitment to resolving tax disputes amicably through Alternative Dispute Resolution (ADR).

This approach seeks to improve compliance while reducing disputes and litigation.

The revenue authority reiterated its commitment to being a professionally managed public organization.

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According to government officials, the liquidity problem has been caused by the prioritization of debt owed by the govrnment, promising that the salaries would be disbursed in the coming days.

The government is obligated to pay debts first, then pension, followed by other recurrent expenditure.

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