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Tax target reviewed up by 12pc

Kenya Revenue Authority (KRA) targets to raise Sh798.84 billion in the second half of 2017/18 financial year (January to June) in a bid to collect funds for the government’s Big Four development agenda.

Commissioner General John Njiraini said in a statement the agency is shifting focus on collecting 12.2 per cent more revenue leveraging on the improved business environment following the conclusion of a tense electioneering period.

Njiraini said KRA has embarked on a strategy that will involve utilisation of data collected through i-Tax to net the non-compliant and deliberate evaders, enhance debt collection and adopt an aggressive approach to net 20,000 landlords. He said the agency will also rely on enhancing cargo scanning by Customs department following the commissioning of a second container scanner at Mombasa Port. “

Tighter control over cargo scanning following the launch of centralised scanning control through the Scanner Command & Control Centre is expected to become operational by March 2018,” Njiraini said.

Njiraini said the prolonged Presidential Election last year adversely affected business confidence and depressed consumer spending, leading to a weak performance in consumption related taxes, especially in the non-essential goods sectors including beverages.

In the first quarter of the current financial year, Pay As You Earn recorded a growth rate of 9.2 per cent driven by improved compliance within the public sector. Value Added Tax (VAT) recorded growth of 7.5 per cent mainly driven by the expansion of withholding VAT framework which now encompasses almost 7,000 agents.

Domestic excise tax recorded the worst performance, declining by nine per cent in the first half compared to annual average growth of 16 per cent over the previous three years.

Remittances from the main excise sectors of beer, tobacco and spirits, declined by 8.4 per cent attributed largely to drop in volumes; 16 per cent for tobacco, 11.2 per cent for spirits and 16.3 per cent for beer.

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