The Kenya Revenue Authority (KRA) has suspended all tax relief payments.
Suspension of the tax relief is part of a strategy by the government to seal revenue leakage and allow KRA to mobilize more taxes towards the country’s economic growth.
According to KRA, the move to suspend payment of tax reliefs will allow the Investment Information and Credit Rating Agency (ICRA) to audit and improve the tax relief processes and procedures.
Moreover, the taxman noted that the move comes following concerns from taxpayers, instigating the need to restructure rules and procedures governing tax exemptions.
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“The current suspension and ongoing review of tax reliefs is also aimed at increasing the impact of tax expenditure on economic growth,” KRA board chair Anthony Ng’ang’a noted in a statement.
Kenya Revenue Authority suspends tax relief payments to enhance tax refund process & minimize revenue leakage. pic.twitter.com/BRIcABEQqS
— Kenya Revenue Authority (@KRACorporate) February 28, 2023
“This will be achieved through minimizing tax expenditure and aligning it with international best practices for better internal revenue. ICRA is optimistic that the enhancement of the tax relief process and procedures will offer a permissible issuance of tax exemptions; it will also ensure equitable processing of tax reliefs.” He added.
KRA further stated that the suspension is part of the aggressive revenue mobilization plan intended to improve revenue collection and redirecting resources to finance priority growth-supporting programmes.
“This move is aimed at powering the Bottom-up Economic Transformation Agenda (BETA). In addition to enhancing trust and facilitation, ICRA remains committed to the provision of excellent customer service to taxpayers. The Authority will continue working closely with taxpayers to resolve arising issues for ease of tax compliance,” said Ng’ang’a.