Outrage as KRA seeks to track mobile money transactions to reduce tax cheat
The government is proposing to monitor individual mobile money transactions by integrating Kenya Revenue Authority’s (KRA) tax system with M-Pesa in effort to reduce tax evasion.
The 2023 Budget Policy Statement released by the exchequer yesterday for the 2023/24 fiscal year, the government is seeking access to individual and companies’ mobile money transaction records in a move that is intended to open a new front in the fight against tax evaders.
“As part of the economic turnaround plan, the government will scale up revenue collection efforts by the Kenya Revenue Authority (KRA) to Sh3 trillion in the Financial Year 2023/24 and Sh4 trillion over the medium term,” the Treasury stated.
KRA will be tracking the 16 percent value-added tax (VAT) on sales as well as the 20 percent excise duty charged on transactions.
The taxman is targeting mobile money as part of the agency’s financial data gathering scheme that is meant to monitor businesses and individuals who are not paying their fair share of taxes.
Telcos, which had been targeted to share data on mobile money transactions, especially on the business platforms with pay bills and till numbers, have previously opposed the move and KRA is said to be in discussion with the firms to access the information as well.
The taxman will flag differences in remittances on M-Pesa, Paypal, and Pesalink and returns for tax evasion.
Mobile money transactions started in 2007 as a means of sending money between friends and relatives but have since evolved to include payment of bills and government services.
