Kenya struggling to collect £2.2bn in tax demands

3 Sep 19

The Kenyan government has been unable to claim 283bn Kenyan shillings (£2.2bn) it has demanded from high-earning taxpayers because of a huge appeals backlog caused by a judicial “vacuum”.

Kenyan newspaper Daily Nation reported that the Tax Appeals Tribunal has not met for 14 months – since the previous team’s term in office expired.

The tribunal should have been dealing with appeals made by businesses and individuals from whom the Kenya Revenue Authority (KRA) had demanded money.

But during that time, Daily Nation reported, taxpayers have been happy to file appeals safe in the knowledge that the tribunal would not meet.

KRA commissioner-general James Mburu, who took over in June, told the newspaper: “Defaulters took advantage of this vacuum to lodge cases at the Tax Appeals Tribunal and we could only wait.”

It is the responsibility of the National Treasury, led by cabinet secretary Henry Rotich, to appoint members of the tribunal.

He appointed 19 of them, whose term ended in April 2018.

By last week, 803 appeals had been lodged since the tribunal last met.

Mburu said he hoped the tribunal would meet at some point in September to deal with them.

The Daily Nation also reported on what it called another “stumbling block”, which was that judges issuing ex-parte orders were stopping KRA from demanding tax from defaulters.

There are 667 tax cases pending in the courts, relating to £483m of KRA demands.

In May this year, KRA officials were arrested on suspicion of abetting tax evasion and bribery.

In a statement released by the agency last month, hoped to restore confidence in tax authorities, the KRA said: “The majority of KRA staff are honest and committed to supporting Kenyans in paying their taxes.

“We are committed to weeding from our midst those of our staff who abuse the privilege Kenyans have bestowed on us by engaging in corrupt conduct and by failure to provide taxpayers with the desired level of services.”

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