Where Does A Kenyan SME Stand In KRA’s Tax Amnesty?

The Kenya Revenue Authority (KRA) has announced a tax amnesty to millions in Kenya. The taxman has promised to give a 100 percent tax amnesty during the Tax Day set to be held this week. But where does the Kenyan SME stand in all these?

Many think that when Tax Amnesty is announced, it is all about big businesses and corporations, and nothing to do with the Small and Medium Enterprises (SMEs). But the truth is, the Kenyan SME has everything to benefit from the current amnesty window.

Read Also: KRA Collects Ksh 3.4 Billion From Tax Amnesty Program

Let us get the numbers first.

About 90 percent of businesses in Kenya are SMEs. They employ 86 percent of Kenya’s general population. They contribute about 45.6 percent to Kenya’s gross domestic product (GDP). This means that a wide tax base lies within the SME sector.

But are they doing well? The SMEs.

Not. About 450,000 SMEs are shutting down businesses annually in Kenya. That is; 30,000 monthly and 1,000 daily. These are insane numbers. Ironically, 1,000 businesses are registered daily in Kenya. 1,000 die daily, 1,000 registered daily.

But what is causing the death of so many SMEs in Kenya?

The high cost of doing business in Kenya has often been pointed out as one of the greatest killers of SMEs. That, coupled with taxes has seen many small businesses struggle to survive across the country with calls on the government to “do something.”

And what about the Tax Amnesty from KRA?

The Kenya Revenue Authority (KRA) has announced a tax amnesty on interest and penalties for tax debts incurred for periods up to December 31, 2022. The tax amnesty will run from September 1, 2023, to June 30, 2024. This is a chance for SMEs who have been having trouble with KRA to have a sit-down with them and agree on how they can pay in a flexible manner with all penalties waived.

Read Also: KRA’s Tax Amnesty: Empowering Taxpayers For A Win-Win Scenario

We have a Twitter Space

We have an interesting Twitter Space (X) coming up this Tuesday on Tax Amnesty and what it means for SMEs in Kenya. Please set your reminders here https://twitter.com/i/spaces/1DXxyjwLeDvKM?s=20

Read Also: KRA’s Generous Gift This Taxpayers Month: Tax Amnesty Wipes Away Interest And Penalties Up To Dec 31, 2022