KRA Revenue Collection for FY 2023/24 Rises 11% to Ksh 2.4 Trillion, Misses Target
The Kenya Revenue Authority (KRA) has fallen short of its ambitious tax collection targets for the 2023/2024 fiscal year.
Despite an 11.1% increase in overall revenue to Ksh 2.407 trillion, KRA failed to reach its target, leaving policymakers and industry stakeholders concerned about the underlying factors driving this underperformance.
A closer examination of the data reveals widening cracks in the economy, with several key sectors—including manufacturing, finance and insurance, and information and communications technology (ICT)—experiencing significant declines in their tax contributions. These sectors also faced reduced corporate profits and job cuts during a period marked by the depreciation of the shilling and high energy prices.
According to the Authority, these factors affected revenue mobilization efforts.
“KRA collects revenue on behalf of other government agencies, mainly at the ports of entry. These include the Road Maintenance Levy, Air Passenger Service Charge, Aviation Revenue, Petroleum Development Fund, Petroleum Regulatory Levy, and Housing Levy, amongst others,” the statement read.
KRA aimed to collect Ksh 2.768 trillion by the end of the financial year 2023/2024, a target which was later revised downward to Ksh 2.5 trillion. Ultimately, KRA missed both targets.
In December 2023, KRA cited the significant depreciation of the Kenya shilling against the US dollar by 24.7% in November 2023 and 22.0% from July to November 2023 as major challenges.
On Monday, KRA reported that during the financial year ending June 30, 2024, it collected agency revenues amounting to Ksh 184.036 billion, reflecting a growth of 34.9% compared to the last financial year.
KRA added that during the financial year, Domestic Taxes registered a revenue growth of 14.4%, collecting Ksh 1.611 trillion against a target of Ksh 1.677 trillion, translating to a performance rate of 96.1%.
KRA reported that domestic VAT collection stood at Ksh 314.157 billion against a target of Ksh 307.823 billion, reflecting a growth of 15.3% compared to the previous year.
The Authority said Pay As You Earn (P.A.Y.E) registered a growth of 9.7%, collecting Ksh 543.186 billion.
As of June 30, 2024, a total of 8,046,029 tax returns were filed, against a target of 7,187,932, representing a growth of 26% compared to the 6,385,523 tax returns filed last year.
