According to data from the National Treasury, the Kenya Revenue Authority has missed its half-year target by Sh88.3b. The records indicate that the revenue authority was not able to hit any of the targets in its tax categories.
KRA projects to raise Sh1.8 trillion by June 2020 as compared to the Sh1.58 trillion collected in FY2018/2019. In the six months to December 2019, the authority was able to collect returns 18.8% higher than it had in the same period in 2018 which stood at sh722.3 billion. Despite the rise, the
income tax did not managed to meet its target.
KRA was able to collect Sh367.4 billion from businesses and employees in terms of income tax which saw it miss its target for the period by Sh25.9 billion. In this instance, income tax according to the KRA includes corporate income tax which is charged at 30% on the company’s profit and Pay as You Earn (PAYE) which is levied on the employee’s salaries.
This has been accredited to the fact that 2019 was filled with massive layoffs while some companies announced profit warnings and others closed down. Additionally, the revenue collected from the excise tax contributed to only Sh103.3 billion. The tax, which is levied on products such as beer, financial services and airtime missed its target which stood at Sh127.9 billion.
The list of missed targets continues as for the Value-added tax, which is usually charged at 16% gave the revenue authority Sh211.5 billion as compared to its target of Sh224.6 billion the previous period. However, revenues, which include fines and fees were able to increase and contribute Sh123.9 billion.