It’s time to set realistic tax collection targets

Times Tower in Nairobi, the headquarters of Kenya Revenue Authority (KRA). FILE PHOTO

The revelation that Kenya Revenue Authority (KRA) missed its collection target in the first quarter by nearly Sh80 billion should not come as a surprise given the prevailing economic headwinds.

Consumption figures for essential products such as fuel, failure to remit Pay-As-You-Earn by some State entities and exemptions of import tax on food items among other factors, are to blame for the under par performance

KRA Commissioner-General Humphrey Wattanga’s admission to Parliament that various economic parameters have defied the norm points to the need to set revenue collection targets based on reality on the ground.

The practice of raising collection expectations every year without necessarily looking at underlying factors must stop and instead be informed by prevailing conditions. The government at the same time should understand that a painful tax policy is no way to grow the numbers as people will always look for a means to circumvent the systems.

It is time the government set realistic tax revenue targets if the KRA is to avoid the now predictable below par performance that has characterised each quarter of every financial year.