The action by Kenya Revenue Authority (KRA) to introduce Electronic Tax Invoicing has in earnest began to bear fruits with more revenue from the Value Added Tax (VAT) obligation collected.
Commissioner of Domestic Taxes Rispah Simiyu, noted that during the last financial year, 2023/2024, VAT collection registered a growth of 15.3%, compared to 13.4% growth registered in the previous year 2022/2023, a performance she attributed to electronic tax invoicing.
The VAT collection stood at Ksh. 314.157 Billion, against a target of Ksh. 307.823 Billion, surpassing the target by Ksh. 6.334 Billion.
The Commissioner expressed the remarks in her presentation to the Institute Certified Public Accountants of Kenya (ICPAK), 12th Annual Tax Convention held in Mombasa.
She noted that Electronic Tax Invoicing contributed to tax base expansion because of its features of enhanced visibility of taxpayer transactions especially those operating in the informal sector, and enhanced tax compliance management, and enforcement due to availability of Tax Invoice data to verify declarations.
The Commissioner assured taxpayers that the Authority is in the process of addressing challenges affecting eTIMS implementation and online service uptake, to make the system more user friendly and responsive to the needs of customers.
She revealed that among the solutions earmarked for adoption to make the system more effective, are the development of simplified solutions that include those with offline functionality and diverse and flexible solutions to help tax payers comply in their own environment.
Other strategies, she added, included stakeholder engagement by sector and taxpayer type, public awareness and a decentralisation of eTIMS support services to all KRA regions and Tax Service Offices.
Emphasizing the Authority’s commitment to collaborating with stakeholders, the Commissioner stressed that the technological innovations being implemented by KRA incorporated both internal ideas and feedback from external stakeholders.
She noted that several initiatives undertaken by KRA have resulted in many positive outcomes, including increased registration of taxpayers under specific simplified tax regimes and an improved customer experience.
The Commissioner highlighted several technological advancement opportunities being pursued by KRA, among them harnessing the taxpayer ecosystem for solution development, advanced technology-user friendly mobile and Web interface to enhance compliance, and development and roll out of pre-populated VAT Income Tax (including personal reliefs) and excise returns.