The Kenya Association of Manufactures (KAM) has advocated for strategic partnership with Kenya Revenue Authority (KRA) in the adoption of high-end drones to improve its corporate tax surveillance.
Speaking to The Informer, KAM highlighted the automation efforts that KRA has been making to ease and simplify tax compliance.
Some of these tools include iTax, iCMS and the proposed Tax Information Management System (TIMS).
“The bolster enforcement and address illicit trade that manifests itself in various shades, including under-declared goods, under invoicing, counterfeit or smuggled goods which continue to deny manufacturers their rightful share,” stated KAM.
KAM further notes that the technology should be used to enhance compliance. However, the systems and processes put in place should not result in increased cost of business to the taxpayer. Additionally, such surveillance tools and technologies should not lead to intellectual property rights (IPR) infringement.
The taxman stated that it intends to commission two unmanned aircraft systems for aerial surveillance.
“The Kenya Revenue Authority invites bids from eligible candidates for supply, delivery, testing, and commissioning of two unmanned aircraft systems for aerial surveillance,” said KRA.
Tax authorities around the world are increasingly turning to unmanned aircraft systems (UAS) to check the accuracy of tax returns or apprehend smugglers.
Tax inspectors, for example, can utilise data collected by drones to verify whether property owners have accurately valued their homes for tax purposes.
The drones will be part of a new wave of tax monitoring devices that will provide the state with real-time access to financial data, including sales returns, for analysis.
In March, the KRA announced the installation of flow meters and CCTV cameras in alcohol plants in an effort to tighten oversight, ensuring the taxman round-the-clock data on manufacturing operations to combat tax evasion.
To maximise excise tax collection, the mass custody flow meter will track enormous volumes of alcoholic beverages produced.
By broadcasting data in real-time, CCTV cameras will also allow the taxman to follow what the businesses are creating.
The system is planned to work in tandem with the existing Excisable Items Management System (EGMS), which makes it easier to trace stamps on excisable goods throughout the supply chain and account for tax payments.
KRA also declared that all electronic tax registers (ETRs) equipment must be connected to its networks for daily sales tracking in an effort to tighten oversight.
The two technologies will provide KRA with a view of items as they leave the production line and make their way to the point of exchange between retailers and consumers, allowing them to collect what is owed at each stage of the supply chain.
ETRs are required by law for all firms with an annual turnover of at least Sh5 million.
In a new drive to enhance revenue collections and reduce tax fraud, the KRA would receive daily sales and invoice data from all registered enterprises and dealers under the new system.
Traders will also have to get authorisation from the taxman to conduct any further business the next day under the scheme, which means that erroneous or incomplete data logged the day before might lock them out.
ETRs with internet access have a number of unique features. For example, it records the purchaser’s personal identification number (PIN).
This is, however, an optional field when creating an invoice, and it is only used when a buyer wants to claim input tax for the VAT they paid.
ETRs with internet access have a number of unique features. For example, it records the purchaser’s personal identification number (PIN).
