Kenya Revenue Authority (KRA) will start posting staff to permanently pitch camp in large companies to monitor revenue streams in an effort to curb tax evasion.
The tax collector has already submitted the regulations before the National Assembly, a move that will see large companies compelled to create space for an employee from Kenya Revenue Authority (KRA).
According to the regulations, KRA staff will be stationed in factories producing excise tax-covered goods such as beer, wines, and spirits, cigarettes, mineral water, soft drinks, juices, and airtime.
The staff will also be stationed in the juices, energy drinks, non-alcoholic beverages, and cosmetics such as Delmonte, Kevian Kenya, Jetlak Foods, PZ Cussons, Blue Plastics and Water Co. Ltd, Aviano Limited, Kenafric Industries, Buyline Industries, Biersdorf East Africa, L’Oreal East Africa, and Kenya Tea Packers Limited.
KRA says the move will help it maximize revenue collection and cut down on cases of big companies evading to pay taxes by presenting fake data. “The commissioner may, for purpose of ensuring proper excise control, require a licensee to provide suitable accommodation and equipment in a factory for the authorized officer responsible for excise control at the factory.’
Pressure has been mounting on Kenya Revenue Authority to meet its tax collection target in order to help the government meet its budgetary obligations. But KRA, on several occasions, has failed to meet its own target, leaving the government with a hole to fill in terms of the budget deficit.
The deficit in the budget has forced the government to rely on borrowing both within and without the country in order to survive. The public debt is currently above 6.2 trillion shillings or 62 percent of the country’s gross domestic product. If the Jubilee government will borrow the anticipated 1.87 trillion shillings, the debt will balloon to at least 8 trillion shillings.