Kenya Sustains Outstanding Revenue Performance Trend in the First Quarter of 2021

By Richard Adorsu-

Photo Credit: Depositphotos

NEW AFRICA BUSINESS NEWS (NABN) Accra- Kenya Revenue Authority (KRA) has recorded the highest revenue performance rate since the beginning of the Financial Year 2020/2021 after collecting Kshs 144.6 billion in March 2021 surpassing the revenue target.

This is an outstanding performance compared to the month of February when KRA collected Kshs 127.7 billion registering a performance rate of 105.1% to surpass its February revenue collection target. Despite the slow economic progression, KRA registered 11.2% revenue growth collecting a surplus of Kshs 6.6 billion in March 2021. This was the fourth month running that KRA posted an improved and above target performance since December 2020.

The good revenue performance has been enhanced by the sustained implementation of compliance efforts, revenue enhancement initiatives and improved service delivery to taxpayers.

In the fourth month running, Customs & Border Control (C&BC) Department continued to record excellent performance after achieving a growth of 47.3% with a revenue collection of Kshs 60.751 billion, the second highest monthly collection in its history. This is an improved performance compared to the month of February when C&BC collected Kshs 51.3 billion reflecting a growth of 24.9%. Customs & Border Control surpassed the revenue target after
collecting a revenue surplus of Kshs 14.409 billion in March 2021, achieving a performance rate of 131.1%.

Domestic Taxes registered a performance rate of 91.4% after collecting Kshs 83.378 billion. The performance was largely affected by Corporation Tax which registered a decline of 35.2%, driven by significant decline of 62.8% in the ICT sector.

PAYE registered improved performance of 110.7% with collection of Kshs 34.595 billion accumulating a surplus of Kshs 3.339 billion. The performance was boosted by revenue collection in the public sector which had a growth of 5.7%.

Withholding Tax registered revenue growth of 15.4% with a collection of Kshs 9.418 billion which implied performance rate of 106.0%. Domestic Excise Duty recorded a performance rate of 61.9% after collecting Kshs 4.521 billion.

Domestic Value Added Tax (VAT) collection amounted to Kshs 17.017 billion registering improved growth of 4.2% compared to 1.6% growth in February 2021. This was equivalent to a performance rate of 81.3%.

With the Kenyan economy anticipated to expand by above 6.0% over the medium term, compared to 0.6% projected in 2020 (according to Budget Policy Statement 2021), the country remains positive on revenue performance.

KRA is also implementing a number of revenue enhancement measures. These include revamping the audit function, tax base expansion and enhanced debt programme, implementation of post clearance audits, comprehensive audit of all exemptions, enhanced scanning and intelligence led verification of cargo at the ports of entry.

KRA also continues to leverage on technology to enhance efficiency in revenue collection. With enhanced operational efficiency, the Authority is optimistic that the landscape of revenue mobilization and collection in this country will be completely changed. KRA has also intensified its fight against tax evasion to ensure that no revenue is lost.

KRA reminds all taxpayers to file their 2020 annual tax returns in good time. The filing for the 2020 year of income is on, having kicked off on 1st January 2021. All annual tax returns for both individuals and entities from January to December 2020, should be submitted online on the iTax platform on or before 30 June 2021.

KRA appreciates compliant taxpayers for honoring their tax obligation. Their contribution through payment of taxes has furthered Kenya’s economic sustainability and safeguarded the sovereignty of this great nation. Through your support, KRA is optimistic that it will perform better in the coming months.

For New Africa Business News Richard Adorsu Reports,  Africa Correspondent