The Kenya Revenue Authority (KRA) has formally wound up the long-standing Domestic Taxes Department.
KRA Commissioner-General Humphrey Wattanga, in Gazette notices dated November 25, 2025, announced that all the functions of the department will be transferred to two successor offices responsible for different taxpayer segments.
The Large and Medium Taxpayers and Micro and Small Taxpayers Departments will succeed the now-defunct Domestic Taxes Department.
“(a) transferred all functions of the Domestic Taxes Department relating to large and medium taxpayers to the Large and Medium Taxpayers Department; and
“(b) transferred all the functions of the Domestic Tax Department relating to micro and small taxpayers to the Micro and Small Taxpayers Department, with effect from the 10th February, 2025,” part of the notice issued under Section 13A of the Kenya Revenue Authority Act reads.
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KRA outlines the functions of units, replacing the Domestic Taxes Department
The accompanying delegation notices further outline how authority will now be exercised under the new structure.
Gazette Notice No. 17630 delegates powers under the Income Tax Act, VAT Act, and Excise Duty Act for large and medium taxpayers to the Commissioner of Large and Medium Taxpayers and revokes the previous delegation to the Commissioner of Domestic Taxes issued on June 10, 2005.
Similarly, Gazette Notice No. 17631 delegates equivalent powers to the Commissioner of Micro and Small Taxpayers for micro and small taxpayers, and revokes the 2005 assignment to the Domestic Taxes Commissioner.
According to KRA, the Domestic Taxes Department accounts for 65% of its revenue collections. It has been the central unit responsible for assessing, collecting, and administering most domestic taxes.
The department has fulfilled its mandate through the iTax platform, which supports taxpayer registration (issuance of KRA PINs), the filing of returns, and general facilitation aimed at improving voluntary compliance.
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Its duties have included assessing taxes for individuals and businesses, offering taxpayer support services, and enforcing domestic tax laws, including penalties for late filing or payment.
Other functions
The department has also been advising Treasury Cabinet Secretaries on matters related to revenue administration and has played a role in international tax cooperation, particularly the exchange of information for tax purposes.
In addition, the Domestic Taxes Department has been responsible for administering several key taxes, including Income Tax (such as PAYE for employees and Corporation Tax for companies), Value Added Tax (VAT), Excise Duty, Turnover Tax for small businesses with an annual turnover of between Ksh1 million and Ksh25 million, Capital Gains Tax, and Withholding Tax collected on payments such as professional fees, commissions, and interest.
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