The Kenya Revenue Authority (KRA) has been forced to extend its deadline for eTIMS registration as less than one percent of the businesses registered so far.
However, according to Kenya Revenue Authority (KRA) authorities, only 6,000 enterprises registered in the four months, accounting for less than 1% of all registered businesses in the country.
To increase uptake, KRA has now extended the deadline for onboarding the eTIMS system from January 1 to March 1, 2024.
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“There’s a bit of delay especially from the taxpayers who are not registered on VAT because as we speak as of December last year, we only have about 6,000. The data available to us on registered businesses, the ones that have a PIN, are about 663,000 entities that are expected to be on board by March 2024.”Said eTIMS Chief Manager Hakamba Wangwe
"But then the information out there, when you look at the informal sector and when you look at businesses which are not registered for PIN, we're projecting that the number could be upto 7 million customers," she added.
According to Hakamba, due to mistrust, the use of software that allows the taxman to monitor company transactions has remained low.
As she argues that the authority is concerned with transaction visibility, she blames the low uptake on the transfer from a manual to an automated system.
"The change aspect of this implementation is that they need to use the technology for tax purposes, and just knowing that the taxman can see your transaction as you work day-by-day is a bit uncomfortable for some, but with technology, again that's the direction most businesses have gone," she said
The government is working to broaden its tax brackets and improve tax revenue collections, but experts caution that doing so too soon or quickly could backfire.
