The colonial era head tax is making its way back in Kenya as East Africa’s largest economy aggressively pushes to expand its tax base.
President William Ruto said every Kenyan above 18-years should be issued with the Kenya Revenue Authority’s (KRA’s) pin, qualifying them as taxpayers.
“Every Kenyan with an ID should have a PIN number. Technology, and a considerate, fair and professional mobilisation will do the job quite well,” Ruto said.
Expansion of the tax base is part of the President’s administration’s target to raise Sh3 trillion by the end of the financial year ending June 30 2023.
“There are only 7 million people with KRA pin numbers. At the same time, in the same economy, Safaricom’s MPESA has 30 million registered customers, transacting billions daily.”
“The fact that this opportunity remains unclear to KRA demonstrates why radical changes are necessary. Safaricom, a telco, has registered more people than KRA, a powerful state organisation. It is very clear that the magic lies in technology and strategy, not power and resources,” he said.
Cumulative tax receipts in the first two months of the 2022/23 fiscal year stood at Sh280.2 billion compared to Sh247.8 billion in the previous fiscal year.
KRA had projected to collect a total of Sh2.072 trillion by the end of the fiscal year ending June 30 2023.
“The consequences are painful to contemplate. Our GDP has risen to Sh12 trillion, yet KRA only raised about 14 per cent of it in revenues last year. In the past KRA was able to raise 18 per cent of GDP,”
“If we collect the same target today then would have raised an extra Sh400 billion. I expect KRA to raise Sh3 trillion by the end of the next financial year and to double the current collection in five years,” he added.