Kiosk Owners Not Spared as KRA Widens its Tax Net

A public notice from Kenya Revenue Authority (KRA) has stated that kiosk owners in the country will be forced to start paying tax, just like other businesses, in a move to ensure that all businesses comply.

The notice disclosed that a door to door inspection is going to be carried out by KRA’s officials across the country. This move will affect many business people as small scale farmers in villages have also been targeted and more to this, they will be paying taxes based on their turnover and not profits. Those in the rental property business are also in the target bracket.

“KRA wishes to notify the general public that it is carrying out on spot verification of the location of properties and business premises through the block management approach in all towns,” the agency said.

The tax man added that those who will be visited during the exercise, particularly property owners and traders will be required to accord the KRA officials the necessary support and provide information as may be called upon.

Read: Insurance Brokers to pay Sh.1.5 Billion to KRA

However, it was not immediately clear what action the agency would take against those found not to be tax compliant. KRA has been falling behind its revenue collection targets for years because Kenyan businesses mainly operate informally.

The National Treasury Cabinet Secretary (CS) Henry Rotich issued a directive, during the unveiling of the National Budget approximations that everyone should pay taxes irrespective of the sector or size of business in which they are in.

“We must widen the tax net so that everyone eligible to pay tax, including those in the informal sector, does so. In this respect, I have asked KRA to explore ways of taxing the informal sector and to redouble their efforts to net tax evaders,” said Rotich.