The Kenya Revenue Authority (KRA) surpassed Ksh 2 trillion in cumulative tax collection as at March 31, 2026, reaching Ksh 2.038 trillion in the third quarter of FY 2025/26.
KRA stated Tuesday, April 7, that this reflects a 96.1% performance rate against the Ksh 2.122 trillion target.
According to the KRA, revenue grew by 11.4% to Ksh 1.829 trillion compared to the Ksh 1.629 trillion collected in FY 2024/25.
KRA Surpasses Ksh 2 Trillion Mark
KRA attributed the growth to improved compliance and digital reforms, even as households and businesses navigated a challenging economic environment marked by subdued demand and elevated costs.
“The performance reflects deliberate institutional reforms aimed at simplifying compliance, deepening digital integration, and embedding tax administration more seamlessly within everyday economic activity through data-driven administration,” the authority said.
This achievement now places the authority at about 69% of its full-year goal of KSh 2.97 trillion. As a result, approximately KSh 932 billion remains to be raised in the final quarter.
Quarterly Growth
The authority noted that revenue collection maintained steady quarter-on-quarter growth across all three quarters, indicating improved consistency in compliance and a gradual strengthening in economic activity.
Furthermore, KRA emphasized that the consistent growth trend reflects the positive impact of ongoing compliance and facilitation interventions, which have been instrumental in sustaining the upward trajectory:
Customs remained the outperformer, with the taxman collecting Ksh 733.7 billion, achieving a 100.9% performance rate and registering 13.3% y/y growth.
At the same time, KRA reported that domestic taxes remained the largest contributor to revenue, generating KSh 1.301 trillion between July 2025 and March 2026.
This marks a 10.4% growth compared to the same period last year.
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Revenue collected on behalf of other government agencies totaled Ksh 204.45 billion, achieving a 101.4% performance rate against a target of Ksh 201.7 billion. This was a 10.7% increase from Ksh 184.65 billion in the previous year.
Meanwhile, exchequer revenue—the funds collected for the National Treasury—stood at Ksh 1.834 trillion, reflecting a 95.5% performance rate against the Ksh 1.921 trillion target.
The taxman recorded a 11.5% growth from Ksh 1.644 trillion collected in the corresponding period of FY 2024/25.
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Macroeconomic Pressures and Middle East Turmoil Threaten KRA Revenue Growth in Q4
Macroeconomic conditions, however, presented a complex backdrop for revenue collection. While economic growth improved to 4.9% in the third quarter of 2025, signaling an economic recovery, inflation remained at 4.4% in March 2026.
The inflation was primarily driven by increased costs in food, transport, and housing, creating financial pressures on both households and businesses.
These conditions influenced consumer spending and business operations, which, in turn, affected tax revenue for the Kenya Revenue Authority.
Customs, KRA’s perennial top performer, now faces potential setbacks as the turmoil in the Middle East threatens revenue collection in the fourth quarter of FY 2025/26.
Petroleum imports, which typically generate around Ksh 30 billion in monthly taxes and levies, are experiencing delays, while overall imports from the Middle East—accounting for roughly Ksh 273 billion in annual tax revenue—are also at risk.
