Kenya Revenue Authority has set a new record in annual revenue collection after managing to raise Sh2.166 Trillion in the Financial Year 2022/23.
The revenue collection is the highest ever in Kenya’s history considering that it is Sh135 billion more that was collected in the Financial Year 2021/2022.
This represents a 6.7 percent growth in revenue.
“The revenue collection signifies a performance rate of 95.3 percent against the target despite an economic slowdown occasioned by an unfavourable global fiscal environment,” KRA said in a statement.
KRA said the revenue performance was adversely affected by slowed domestic economic growth and a series of shocks that impacted the economy.
The authority cited prolonged drought and, international conflicts as major contributors to economic setbacks.
“This mirrors the World’s real GDP growth that decelerated to 3.4 percent in 2022 from a growth of 6.0 percent in 2021 disrupting the supply chain, and high prices of fuel, electricity, and food,” KRA added.
“The general economic environment was also influenced by an exchange rate of the Kenya Shilling against the dollar, which registered a consistent depreciation.”
KRA said the overall inflation remained above forecast levels averaging 8.78 percent compared to an average of 6.15 percent in the financial year 2021/2022.
This, KRA says, was mainly driven by high fuel, electricity, and food prices.
KRA is also mandated to collect revenue on behalf of other government agencies mainly at the ports of entry.
The authority collected Sh 136.390 billion on behalf of the agencies reflecting a growth of 3.7 per cent compared to the last financial year.
“Domestic Taxes collected Sh1.407 trillion against a target of Sh1.481 trillion while Customs and Border Control (C&BC) collected Sh754.090 billion.
This translates to revenue growth of 8.5 percent and 3.5 percent respectively compared to the same period in FY 2021/2022.
Despite overall import values increasing by 15.3 percent Customs performance was in part affected by growth in exemptions and remissions which grew by 39.7 percent.
The special exemptions were part of the government’s strategies to mitigate against adverse effects of drought and reduce the cost of living
Excise on Betting registered a stellar performance rate of 116.2 percent after collecting Sh6.640 billion against a target of Sh5.715 Billion. Excise on Betting collected a surplus of Sh925 Million and grew by 30 percent compared to the same period in FY 2021/2022.
The performance is attributed to the integration of the Betting companies into the KRA tax system which has streamlined tax remittance from the sector and scaled up revenue collection.
Domestic VAT collection soared to Sh272.452 Billion reflecting a growth of 11.3 per cent compared to the previous year. This is attributed to the Tax Invoice Management System (TIMS) which boosted compliance among VAT-registered taxpayers.
VAT grew by 18.0 percent between Feb-June 2023 in comparison to the 6.7 percent growth rate in the first seven months of FY 2022/23 due to the implementation of TIMS & eTiMS.
Pay As You Earn (PAYE) collected Sh 494.979 Billion. The performance was mainly driven by remittance from private firms and the public sector which grew by 10.7 percent and 1.9 percent respectively.
Source-https://www.nairobileo.co.ke/
KRA Sets New Record With Highest Collection of sh2.166 Trillion in 2022/23
