KRA collected a paltry Sh354m in taxes from Covid-19 billionaires

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Times Tower in Nairobi, the headquarters of Kenya Revenue Authority.

Photo credit: File photo

What you need to know:

  • Imports to the country are subjected to a standard VAT rate of 16 per cent, levied on the sum of the Cost, Insurance and Freight (CIF) value, duty and other applicable taxes.

The government collected a paltry Sh354.1 million in taxes from vendors who made Covid-19-related supplies to Kenya Medical Supplies Authority (Kemsa), according to data presented to Parliament by Kenya Revenue Authority (KRA).

The KRA documents indicate that the taxes were realised from 851 importers who supplied 431,614 COVID-19-related items to Kemsa between March 2020 and July 2020.

The supplies included facemasks, KN95 masks and surgical masks to help the country cushion the people from the vagaries of the deadly pandemic at the time.

KRA Commissioner-General Humphrey Wattanga told the Committee on Implementation of the National Assembly that the payments received by the government were for import duty, Value Added Tax (VAT), Import Declaration Fee (IDF) and Railway Development Levy (RDL).

“The goods were released through customs after the requisite taxes were paid accordingly,” Mr Wattanga told the committee chaired by Budalangi MP Raphael Wanjala.

The customs collections details from KRA show that 682 importers supplied 378,120 facemasks and remitted Sh200.4 million to the taxman with 106 vendors delivering 28,697 KN95 masks and paying Sh130.52 million in taxes.

About 63 importers delivered 24,747 surgical masks to Kemsa and paid Sh23.21 million to the taxman. Import duty is levied at the rate of between 0  and 100 per cent with an average rate of 25 per cent.

Imports to the country are subjected to a standard VAT rate of 16 per cent, levied on the sum of the Cost, Insurance and Freight (CIF) value, duty and other applicable taxes.

The KRA boss noted that the tax audits and compliance reviews took into consideration taxpayers who were registered as having imported goods but failed to declare sales in their VAT monthly returns.

“Assessments were raised as appropriate for the non-compliant cases and some taxpayers complied by making the respective declaration and payments or payment plans,” said Mr Wattanga.