KRA Hits Trillion Shilling Mark In Revenue Collection Despite Economic Headwinds

• KRA announced that it had crossed the one trillion shilling mark in revenue collection as of December 8, 2023
• The taxman recorded a 15.8% surge in revenue growth throughout November, culminating in a total collection of KSh 1.030 trillion
• KRA collected KSh 180.714 billion in November 2023, up from KSh 156.095 billion collected in November 2022

Elijah Ntongai, a journalist at TUKO.co.ke, leverages more than three years of expertise in financial, business, and technology research, providing profound insights into both Kenyan and global economic trends.

On Monday, December 11, the Kenya Revenue Authority (KRA) announced a significant milestone, crossing the one trillion shilling mark in revenue collection as of December 8, 2023.

Although the country encountered economic shocks and faced adverse economic indicators, KRA recorded a 15.8% surge in revenue growth throughout November, culminating in a total collection of KSh 1.030 trillion.

The consistent upward trajectory in revenue collection showcased by KRA in revenue collections has been a defining trend in the past five months (July-November 2023).

"The Authority has maintained an upward trajectory in revenue collection, after recording a 15.8% growth in the month of November. This is after KRA collected KSh 180.714 billion up from KSh 156.095 billion collected in November 2022," read the press release by KRA.

Economic indicators

KRA's growth in revenue collections unfolds against a backdrop of economic indicators that have exhibited contrary trends.

"In spite of the progressive growth, the collection was affected by performance of key economic indicators that directly drive revenue collection. These key indicators that significantly impact on revenue performance have generally moved contrary to expectations, with adverse impact on revenue mobilisation," read the press release in part.

The depreciation of the Kenyan shilling against the US dollar by 24.7% in November 2023 and 22.0% in the period of July to November 2023, alongside soaring prices of critical commodities like oil, notably impacted import demand.

How much revenue did customs generate

TUKO.coke previously reported on the tax policy changes on items to be taxed while travelling, which were initiated by the Kenya Kwanza administration to bolster revenues collected through customs.

These policy changes seem to have yielded positive growth in revenues as the customs division of KRA reported the second-highest monthly collection in its history, amassing KSh 72.116 billion, a 17.6% growth compared to November 2022.

"The growth was also driven by positive impact of tax policy which include the VAT rate change from 8% to 16% vide Finance Act 2023," noted KRA.

Looking ahead, KRA remains steadfast in its commitment, targeting a collection of KSh 2.787 trillion by the conclusion of the 2023/2024 financial year and remains confident in sustaining this upward trajectory in revenue collections.

KRA awarded

In other related news, TUKO.co.ke reported that at the 4th edition of the Huduma Ombudsman Award ceremony, KRA received the Public Service Delivery Category award for its strategic use of technology to meet information needs, and for demonstrating a commendable commitment to exceptional public service delivery.

The award recognized KRA's commitment to actively disseminate information through various online channels such as the KRA website, KRA TV, and social media accounts.

The authority was also recognised for the use of technology for public awareness, campaigns, and alternative dispute resolution in the realm of public service delivery.