NAIROBI, Kenya, Jul 31 – The Kenya Revenue Authority (KRA) is ramping up efforts to crack down on tax evasion through tighter compliance measures and digital reforms aimed at creating a fairer business environment.
The reforms were discussed during a meeting between KRA and the Kenya Private Sector Alliance (KEPSA), where the tax authority outlined plans to widen the tax base, improve tax administration and make it easier for businesses to comply with tax laws.
The push comes as the government looks to raise more revenue by bringing more businesses into the tax net instead of placing additional pressure on those already paying their taxes.
KRA Commissioner General Adan Mohammed said businesses should be able to compete under the same tax rules, noting that tax evasion gives non-compliant firms an unfair advantage.
“Our commitment is to create a level playing field where every business competes fairly and every taxpayer meets their obligations,” he said.
Mohammed said businesses that pay their taxes are often disadvantaged when competitors avoid their obligations, making it harder for compliant firms to compete on equal terms.
As part of the reforms, KRA is integrating the Integrated Customs Management System (iCMS) with the iTax platform.
The integration will automate the verification of import and export transactions, reduce manual intervention and strengthen compliance monitoring.
The authority is also working to cut the processing time for eligible Value Added Tax (VAT) refunds from several weeks to less than 10 minutes.
Faster refunds are expected to improve cash flow for businesses that rely on timely tax reimbursements.
KRA is also reviewing its tax administration processes following concerns from the private sector over delays in VAT refunds and inconsistencies in the classification of raw materials and intermediate goods.
Businesses say the issues have increased costs and created an uneven competitive environment in some industries.
According to Mohammed, expanding the tax base offers a more sustainable way of increasing government revenue than relying on the same pool of compliant taxpayers.
KEPSA, meanwhile, called for quicker resolution of tax disputes through wider use of Alternative Dispute Resolution (ADR) mechanisms.
The business lobby said reducing the average resolution period from 120 days to about 90 days would help free up capital and give businesses greater certainty when planning investments.
