Kenya Revenue Authority (KRA) has crossed the Ksh2 trillion mark after collecting Ksh2.112 trillion as of April 30, 2025.

In a press statement to the media, KRA Commissioner General Humphrey Wattanga said that the collection reflects a performance rate of 96.5 per cent against the target of Ksh2.189 trillion.

The Kenya shilling opened the week exchanging at Ksh129.50 to the US dollar ($1 = Ksh129.50)

Wattanga said that during the period, revenue collection registered a growth of 6.1 per cent reflecting an upward trajectory in collection compared to Ksh1.990 trillion realised in the same period during the previous financial year, 2023/2024.

“In the period under review, domestic taxes amounted to Ksh1.386 trillion between July-April 2024/2025, translating to a revenue growth of 4.7 per cent over Ksh1.3 trillion realized in July-April 2023/2024,” he said.

He added that customs revenue collection also grew by 9.1 per cent after registering a cumulative collection of Ksh722.7 billion compared to Ksh662.4 billion that was collected in the same period of financial year 2023/2024.

On agency revenue collected on behalf of other government entities, the authority stated that they had a collection amounting to Ksh205.5 billion, registering a performance rate of 111.8 per cent against a target of Ksh183.789 billion.

“This represents a growth of 37.1 per cent compared to the collection of Ksh149.876 billion realized in the same period of previous financial year 2023/2024,” added Wattanga.

On statistics given, Exchequer revenue collected on behalf of the National Treasury amounted to Ksh1.906 trillion, reflecting a performance rate of 95 per cent against a target of Ksh2 trillion. This represents a growth of 3.6 per cent compared to the collection of Ksh1.84 trillion that was collected in the same period in the previous financial year 2023/2024.

According to the commissioner-general, despite the progressive growth, the collection was affected by various economic indicators that directly drive revenue collection adding that the various indicators that influence revenue performance have generally moved contrary to expectations, affecting revenue mobilisation.

He noted that gross domestic product (GDP) grew at a slower pace of 4 per cent in Quarter three (Q3), 2024 compared to 6 per cent in Quarter three (Q3) 2023. Similarly, the Purchasing Manager Index (PMI) averaged at 49.8 between July 2024 and April 2025, indicating a slowdown in private sector activities.

“This subdued demand was further evidenced by a 1.6 per cent drop in import values, an important indicator of domestic demand for both raw materials and consumer goods,” he added.

Additionally, despite the Central Bank of Kenya (CBK) lowering its base lending rate to 10.75 per cent, commercial bank lending rates remains high, averaging 17.22 per cent as several banks had yet to adjust their rates.

The commissioner general also noted that the disparity negatively impacted private sector borrowing and investment. However, he stated that there are strong indications that most banks are working towards ensuring compliance.

Wattanga added that despite a stronger shilling, the value of imports declined, particularly oil which dropped by 10.2 per cent. Export earnings also shrank by 3.6 per cent, driven by declines in key sectors such as tea and horticulture.

He said the adverse effects from most of these indicators is beginning to dissipate as most of them start to experience a turnaround in the recent past. He noted that a recent policy change has allowed taxpayers to offset their current tax liabilities using adjustment vouchers such as refund and overpayment adjustment vouchers.

“A number of taxpayers utilised Ksh53.8 billion in adjustment vouchers accrued from previous periods to offset current tax liabilities, reducing effective collection,” he said.

Despite revenue mobilisation being impeded by impacts from the above factors, KRA enhanced its compliance through various initiatives.

“The implementation of a centralised Release office has significantly improved the efficiency of the cargo clearance process. This reform has positively impacted customs revenue performance, with revenue growth increasing from an average of 7 per cent as of the end of January 2025 to 22.6 per cent in March and 14.4 per cent in April 2025,” he added.

Additionally, he said the initiative has contributed to enhanced import values, resulting in an increase in average daily non-oil revenue from Ksh2.087 billion during the period July to February 2024/2025, to Ksh2.309 billion in March and April 2025.

To further improve tax compliance and convenience for landlords, the Electronic Rental Income Tax System (eRITS) was recently rolled out. This digital platform enables landlords and property owners to seamlessly compute, file and pay Monthly Rental Income (MRI) tax.

It also includes property management tools such as property registration and tenancy management, providing a comprehensive user-friendly experience on a single platform. The tax amnesty programme has also seen strong uptake generating Ksh13.5 billion in revenue between December 2024 and April 2025. This initiative aims to encourage voluntary compliance by offering relief on penalties and interests for taxpayers who settle their principal tax liabilities.

“KRA has so far waived Ksh164.9 billion in penalties and interest, benefitting over three million taxpayers,” he said.

The introduction of the Electronic Tax Invoice Management System (eTIMS) has enhanced the ability to detect and prosecute VAT fraud schemes by digitizing invoicing and tax reporting, eTIMS promotes greater accountability and has led to improved levels of tax compliance across the board.

The enhanced dispute resolution framework has expedited the resolution of tax-related disputes, allowing for quicker recovery of revenue previously tied up in convoluted legal processes. As a result, Ksh21.9 billion was released for collection during the period from January to March 2025.

“KRA targets to collect Ksh2.668 trillion by the end of financial year 2024/2025. The authority is confident that it will continue with the upward trajectory and achieve the set target to enable the government to sustain the county’s economy,” he said.

• A Tell Media / KNA report /By Chari Suche