The Kenya Revenue Authority (KRA) has collected Kes1.03 trillion in revenue between July and December 8th, 2023.
In a statement, KRA has attributed improved earnings to a rise in taxes collected from oil that grew to Kes 27.94 billion, representing a 42.5 percent growth compared to a similar period last year.
“The good performance by oil taxes was mainly driven by growth in both overall oil volumes and values by 36.7% and 49.5%, respectively,” KRA says.
“The growth was also driven by positive impact of tax policy which include the VAT rate change from 8% to 16% the Finance Act 2023.”
Similarly, domestic taxes went up to 108.17 billion as of November, a 14.6 percent jump in the review period.
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However, KRA says the growth is despite the economic challenges, including the depreciation of the Kenyan shilling among major global currencies such as the U.S. dollar, inflation, and weak demand, among others.
For example, the Kenyan unit lost 22 percent of its value to the greenback between July and November.
“Revenue performance was also affected by low domestic demand as indicated by the slowed Purchasing Managers Index (PMI) that averaged at 47.18 points in July – November 2023 down from 48.66 points in July – November 2022,” KRA said.
“In particular, depressed aggregate demand is also noted in seemingly slow GDP growth. The tight financial markets marked by increase in lending rates and interbank rates, has slowed down credit extension, especially to the private sector, resulting into decline in Bank profitability by 4.9% as at September 2023.”
KRA targets collecting Kes 2.787 trillion by the end of the 2023–2024 financial year.
