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85% of Kenyan businesses non-compliant to corporation tax: Report
85% of registered Kenyan companies are non compliant to corporation tax, despite a sharp increase in the number of companies registered in the country.
Of the more than 862,000 companies registered with the Attorney General’s office, 129,000 paid installment taxes.
In the 2022-2023 fiscal year, the number of new companies registering to pay corporation tax was approximately 102,000, bringing the total number of registered companies to 862,000 at the end of the fiscal year.
Despite this phenomenon, the KRA reported that 480,000 companies filed their returns in the 2022-23 financial year.
In the same year, 129,000 companies paid installment tax, while in the 2021-22 financial year, 123,030 companies paid installment tax, indicating an increase in corporation tax compliance over the years, according to the tax authority.
At a time when companies are offlining and disabling their Mpesa paybills and till numbers to ostensibly avoid the taxman’s hawk eye, the KRA has deployed Revenue Service Assistants RSAs to visit taxpayers to help them comply with tax laws.
Although the RSAs are frowned upon by the business community, the taxman says they will help taxpayers get on the eTIMS register for correct tax obligations and file simplified returns such as turnover tax.
Earlier, the taxman reported collecting Sh3.4 billion from the ongoing tax amnesty, with 17,000 taxpayers taking advantage of the grace period, during which the taxman hopes to collect a total of Sh10.5 billion.
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