William Ruto's Govt Hopes to Collect KSh 324b More in Taxes as KRA Misses Targets

 

The government aims to increase tax collection by an additional KSh 323.5 billion as part of a budget spending plan that will see the William Ruto-led administration spend a total of KSh 4.55 trillion, mostly on salaries and debt repayments. President William Ruto insisted on an aggressive tax collection strategy. Photo: William Ruto. Source: Facebook According to the 2024 Budget Policy Statement (BPS), the government aims to collect KSh 2.95 trillion in taxes in the fiscal year 2024/25, relying on proposed extensive tax measures that target hard-to-tax sectors such as the informal, digital, and agricultural activities. "The consolidation will be supported by enhanced revenue mobilisation and rationalisation of non-priority expenditure while protecting essential social and development budget,” Treasury Cabinet Secretary (CS) Njuguna Ndung'u said. Why KRA missed the target For the current fiscal year ending in June, the Kenya Revenue Authority (KRA) has been tasked with collecting KSh 2.62 trillion from both direct and indirect taxes. These collections heavily depend on revenue-raising measures outlined in the Finance Act 2023, which includes doubling the value-added tax (VAT) on fuel. KRA fell short of its target for the first six months of the 2023/2024 financial year by KSh 186.2 billion, with the largest contributions to this shortfall coming from income taxes paid by corporations and employees.  Between July and December 2023, the taxman's total revenue amounted to KSh 1.313 trillion. 

by  Japhet Ruto