It appears like KRA has been applying intelligence gathering technologies to nab tax cheats. If you import a car, they will automatically link your importation profile (customs duty) with your domestic taxes and then start investigating your declared incomes. Again, if you purchase a plot of land, during the transfer, stamp duty and capital gains tax prompts them to link start investigating you for previous tax payments to measure up with such a transaction (both the buyer and the seller). Again, if you have more than one KPLC, Nairobi Water, accounts, KRA links up with the service providers and prompt them to commence investigations on possible rental income tax… If you ever transact with any public entity (national and county), this provides rich information for mining and commencement of investigations… etc etc…
Then they are now implementing TIMS system where every invoice (for VAT-registered firms/ individuals) you produce is logged to i-Tax on real-time basis which produces rich data for the seller and buyer that helps them start investigating both of you on a daily basis… Now, this is extremely intrusive on the part of tax payers and certainly creates fear for business people since it provides KRA fellows with arsenals to extort money from the taxpayers (because, it is almost impossible to be 100% compliant and remain in business in Kenya for MSMEs)…
Then we are told that we lose Shs.2b per day from the public coffers… Why can’t the Government spend similar efforts to stop such pilferage? They are simply making taxpayers their slaves only to benefit the public officers and their families…
That’s another great perspective to look at it. However, the core function of TIMS is to collect as much from the public. The rest f the benefits are secondary.
I know, but the intrusiveness they now have into business operations is not good… It feels like you are being watched by a nasty big brother now! There is someone who decided to import a car in his wife’s name this year… the wife has not been filing (even NIL) tax returns for over 10 years… the car was frozen at the port and could not be cleared until she had to deal with her tax affairs… not bad to pay taxes but this is now too much when the collected taxes are ending up in people’s pockets (proven by the number of real estate projects coming up all over without commensurate growth in know businesses)
@Jimjones I guess this must have affected you personally. However some of us support what KRA is doing. Let everyone pay their fair share of the taxes. If this intelligence gathering facilitates this, i support it!
Yes. It has hit me directly. I agree with you 100% that we ALL must pay our fair of taxes… I am only worried that nothing commensurate happening on the expenditure side of public institutions… Why tighten the belt for the tax collection side and do nothing much on the other side?
Sure… But we all know that these are hungry hyenas… extortionist bar none! Once they receive reports, even qualified audit reports, they immediately summon the directors of public institutions involved and cut deals to ignore the findings or water it down… They are only worried about what gets into their pockets… if it is affecting others, they do not care…
Have you ever dealt with KRA fellows? They will over-assess knowingly and if you do not agree, they will freeze your bank accounts very fast and ask you to go to court to complain…
No. I have actually no problems as such now… Resolved a long time ago… I am just sharing because I have had similar complaints from 4 of my friends too… and thought that it might at least help someone else to prepare for such when they make transactions…