KRA Waiver on Tax Penalties: The Kenya Revenue Authority (KRA) has announced waivers on tax penalties that taxpayers have incurred over the past five years. The taxman has made this move as part of strategies aimed at improving tax collection in Kenya following the fall in collected revenue that was occasioned by the coronavirus pandemic.
Following these waivers, taxpayers will now get full or partial relief on penalties and interest on the undisclosed taxes. The waivers will be done through a programme that runs from January 1, to December 31, 2023.
According to a report that appeared in a local daily, this waiver is part of the Voluntary Tax Disclosure Programme (VTDP) which was introduced through the Finance Act, 2020. The programme seeks to grant relief on penalties and interest on any tax liability that was disclosed for tthe period between July 1, 2015 and June 30, 2020.
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“VTDP applies to all tax liabilities accrued/derived in the specified period including individual Income Tax, Corporate Tax, PAYE, Withholding Income Tax, Capital Gains Tax, Value Added Tax, Withholding VAT, Excise Duty, Monthly Rental Income Tax and Turnover Tax,” KRA said in a statement.
KRA added that the type of relief a taxpayer will get will depend on how soon they pay. The fast and first payers will get the most out of the programme.
“Persons who make full payment of disclosed taxes in 2021 will get 100 per cent relief in penalties and interest while those who pay in 2022 and 2023 shall get relief at a rate of 50 per cent and 25 per cent respectively,” the authority stated.
Those who take advantage of the programme will not be prosecuted for disclosed tax liabilities, appeal or seek other remedies with respect to the taxes, penalties and interest it remits. “A taxpayer will not be eligible to apply for relief under the programme if he/she is a party to an ongoing litigation in respect to the tax liability or any matter relating to the tax liability,” KRA said.