KRA has defended the missed revenue targets over the past decade as reported by the Word Bank in its 16th edition of the Kenya Economic Update.
In a statement, the taxman said Kenya’s revenue growth over the past decade compares well with prevailing economic indicators including GDP growth.
This is contrary to the World Bank Kenya report which recorded that revenue collections in the country have underperformed by an annual average of about 3.7 per cent points of GDP.
Mohamed Omary, commissioner for strategy, innovation and risk management, said the financial year 2016/2017 saw Kenya’s tax to GDP ratio stand at 17.1 per cent contrary to the report that placed the ratio to 16.9 per cent.
He said the 17.1 per cent is among the highest tax to GDP ratio in non-oil economies within Africa, and the highest within the EAC region where the average stands at 14.8 per cent.
However, it lags several middle-income country peers including South Africa (27.3 per cent), Botswana (25.6 per cent), Jamaica (26.8 per cent), Mozambique (23.1 per cent) Senegal (19.8 per cent), and Vietnam (19.1 per cent).
KRA’s annual revenue performance released in July this year reported a 13.8 per cent growth in revenue collected in the financial year ending 2016/2017 up from Sh1.21 trillion collected in the financial year 2015/2016.
Omar attributed the growth to increased tax and policy reforms implemented by the taxman, especially those aimed at digitising revenue collection systems to mitigate revenue leakages.
