The Kenya Revenue Authority plans to partner up with telecommunications to spy on money transactions
It also plans to use systems that will gather information on business production trends, ownership of properties as the main way to squeeze at least SH. 3 trillion taxes from Kenyans in the 2023/24 budget proposal.
In the draft Budget policy statement, KRA plans to go big on technology reliance to nab tax cheats, by merging systems with public and private companies and haunting millions of informal business with potential to pay Sh. 28 trillion taxes.
Treasury also laid plans to nab the hard to tax individuals who don’t file tax returns despite trends of generous spending, by requiring KRA to intense its systems with those of telecommunication companies. This would give the authority sight to different people’s spending’s.
The treasury will also track general businesses, land and property owners, with KRA merging its systems with the National Lands Information Management systems (TIMS) and business through the roll out of Tax Invoice Management System (eTIMS) which will give authority access to full trading information by businesses in real time. Filling the gap many businesses have used to evade to pay taxes.
Additionally, the treasury points out that the government will conduct enhanced field data analysis and join KRA’s tax with NLIMS the system that holds all land records in Kenya- to grow land and rental taxes.
It also prepares the micro sized enterprises to pay their share in a plan that could see millions of the business that don’t currently pay taxes have a meeting with KRA.
The president’s government has also laid down strict rules to seal tax evasion holes in Kenya’s manufacturing sector, which plans to monitor full production in factories.
The government has also tasked KRA to address different challenges that have hindered tax compliance , including trend by businesses not to declare or under declare sales and use of fictitious claims. Treasury said , it will be achieved through the full roll out of Etims, restriction to eTIMS compliant invoices for income tax deductions and deployment of big data analytics to drive compliance interventions.
Ruto’s government also wants its key entities to automate their systems and merge them with KRA to allow exchange of information for a 360-degree view on all the taxpayer’s economic transactions .
The draft business proposal expresses the governments focus on enhancing more revenue as a way to allow down public debt and to cut the budget deficit from 6% to 3%.
It has also committed to finalize the National Tax Policy and the Medium -Term revenue Strategy for the period of 2023/24-2026/27 which will guide its revenue collection.
“The National Tax Policy Framework will enhance administrative efficiency of the tax system , provide constituency and certainty in tax legislations and management of tax expenditure. On the other side, the Medium Term Revenue Strategy will provide a comprehensive approach of undertaking effective tax system reforms for boosting tax revenues and improving the tax system over the medium term,” Treasury stated.