The Kenya Revenue Authority (KRA) has reported over Sh2 Trillion in revenue collection in the financial year 2022/2023.
The Taxman recorded a revenue collection of Sh2.166 trillion for the period July 2022 – June 2023, a 6.7 percent growth or Sh135 Billion increase compared to the Sh2.031 trillion it collected in the previous financial year.
The growth was realized amid an economic slowdown occasioned by an unfavorable global fiscal environment. KRA notes that the revenue performance was affected by the slowed domestic economic growth in 2022, which went down to 4.8 percent from 7.6 percent in 2021.
”The decelerated domestic economic growth was due to the adverse impact of multiple shocks that affected the economy, including prolonged drought and international conflicts that disrupted the supply chain, among others. The revenue collection signifies a performance rate of 95.3 percent against the target,’’ KRA said.
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Growth was, on the other hand, supported by the implementation of key strategies, including the transformation of the authority and strict enforcement of tax laws in the fight against tax evasion.
Excise on Betting registered a stellar performance, with KRA collecting Sh6.640 Billion against a target of Sh5.715 Billion. The performance is attributed to the integration of betting companies into the KRA tax system.
Domestic Value Added Tax (VAT) collection stood at Sh272.452 Billion, representing 11.3Â percent growth compared to the previous year. The growth is attributed to the implementation of the Tax Invoice Management System (TIMS), which has enhanced compliance among VAT-registered taxpayers.
Corporate income, which is tax paid by firms, accounted for Sh263.819 Billion, driven by increased remittance from Finance, ICT, Manufacturing, Wholesale & Retail Trade, Electricity, Oil, & Gas sectors.
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Meanwhile, pay-as-you-earn, which is paid by employees, registered a growth of 7.2 percent, with KRA collecting Sh494.979 Billion. The performance was mainly driven by remittance from private firms and the public sector, which grew by 10.7 percent and 1.9 percent, respectively.
This is the second year in a row that KRA has surpassed the two trillion mark. In the last five years, revenue collection has progressively increased from Sh1.58 Trillion in FY2018/2019 to Sh2.166 Trillion in FY2022/23, representing a growth of 37% percent or a KShs 586.259 billion increase.
KRA has been betting on digitization and improved compliance from taxpayers to raise nettings from taxes. The taxman has continued to employ technological strategies to assist seal revenue loopholes.
The Taxman targets to collect Sh2.768 Trillion by the end of Financial Year 2023/2024 and surpass the Sh3 Trillion mark by Financial Year 2024/2025.
