The Kenya Revenue Authority (KRA) is setting up an advanced forensic laboratory that will allow it to mine data, including hidden accounts and records, from taxpayers’ computers and mobile phones to detect tax and financial fraud.
The move is just a small part of a wider surveillance strategy that will see closed-circuit television (CCTV) cameras installed in taxpayers’ premises as well as web-based electronic tax registers (ETRs) that will be able to capture buyers’ personal identification numbers.
The move to upgrade its systems comes as more taxpayers move their transactions and records online, a reality that necessitates systems that can carry out web-based surveillance and forensic analyses from the taxman’s end.
The tax collection agency deserves accolades for its spirited efforts to shore up revenue and go digital. It should, however, tread carefully on such intentions as mining of data. Its plan, at least on paper, raises red flags on the right to privacy, the need for data protection and other aspects of human rights in the digital sphere.
The plan may also create a perception that willing taxpayers are prejudicially being treated as criminals in a country where one of the biggest hurdles to tax collection is that many are yet to be brought into the tax net. Indeed, there have been calls for the taxman to be more friendly to those who are already paying taxes and aggressively go after the many who operate under its radar.
The invasive measures may also beat back the gains made by an earlier campaign to cast payment of taxes as a measure of patriotism. This soft and warm approach was arguably the reason the country was able to increase tax collection from around Sh200 billion two decades ago to the current level. Simply put, efforts to boost tax collection are welcome, but they must be ethically or legally above board.