KRA suspend tax relief payments indefinitely to restructure rules governing tax exemption procedures
The Kenya Revenue Authority (KRA) has suspended all tax relief payments in a bid to enhance the current processes related to the payment of tax refunds, exemptions, waivers and abandonments.
Through a statement, the taxman said that the suspension takes effect from February 28 until further notice to allow it to audit and enhance the tax relief processes and procedures.
According to KRA the move comes in the wake of concerns from taxpayers, initiating the need to restructure rules and procedures governing tax exemptions.
The move is also aimed at increasing the impact of tax expenditure on economic growth which will be achieved through minimising tax expenditure and aligning it with international best practices for better internal revenue.
“KRA is optimistic that the enhancement of the tax relief process and procedures will offer a permissible issuance of tax exemptions; it will also ensure equitable processing of tax reliefs,” KRA board chair Anthony Ng’ang’a stated.
“The improvement is part of the government’s strategy to seal revenue leakage and enable KRA to mobilise more taxes towards the country’s economic growth. It is also part of the aggressive revenue mobilisation plan aimed at enhancing revenue collection and redirecting resources to finance priority growth-supporting programmes,” he added.
Ng’ang’a noted that the move is also aimed at powering the Bottom up Transformation Agenda (BETA).
The National Treasury had earlier indicated in the Tax Expenditure Report that taxpayers had forgone a total of Sh316billion revenues in 2021 with transport, manufacturing, financial businesses profiting from the government’s tax expenditure.
