KRA Identifies 1,309 Wealthy Individuals and Firms Evading Tax
Kevin Namunwa  |  Aug 26, 2020

The Kenya Revenue Authority (KRA) has discovered that tax evaders owe it Ksh 259 billion. The evaders should now brace for travel bans, asset freeze, and deactivation of Personal Identification Numbers (PINs).

The taxman has identified 1,309 firms and wealthy individuals who owe the lot of money. KRA Commissioner General Githii Mburu did not disclose the names but warned the agency is probing the tax evaders further to determine the punishment to be meted.

Apart from travel bans, the tax cheats risk collection of duty directly from their suppliers and bankers as well as prosecution.

KRA promises that this will be the biggest crackdown yet on high net-worth persons.

KRA is racing to bring more people into the tax brackets and curb tax cheating and evasion in the quest to meet targets in an economy where the Covid-19 pandemic has battered collections.

“We have profiled 1,309 individuals and companies with tax-loss estimated at approximately Sh259 billion. These entities are earmarked for further investigations and legal action for non-compliance,” the KRA Commissioner General said in a notice.

KRA has been on the alert of tax evasion schemes including filing of fictitious value-added tax (VAT) invoices. Fictitious VAT invoices have already cost the taxman billions of shillings. KRA also said that other firms have been faking invoices to inflate purchases of inputs in a bid to cut their VAT obligations.

The taxman has shone the light on firms in the construction, importation of hardware and household goods, scrap metal dealers, and importers of electronic items including mobile phones for under-declaring VAT dues.

Wealthy individuals, on the other hand, have been hiding their sources of income while engaging in luxury spending and accumulation of property including purchase of homes and high-end cars.

The KRA enforcement unit has been using various databases to pursue suspected tax cheats, among them bank statements, import records, motor vehicle registration details, Kenya Power records, water bills and data from the Kenya Civil Aviation Authority (KCCA), which reveals individuals who own assets such as helicopters.

Car registration details are also being used to smoke out individuals who are driving high-end vehicles but have little to show in terms of taxes remitted.

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