Kenya Revenue Authority (KRA) has grown its revenue collection over the past five years by 78.2% to KES 707.3 billion in 2012 from KES 397 billion in 2007. The revenue collection by the tax man has been growing year-on-year with Financial year 2010-2011 witnessing the largest growth margin, an increase in revenue collection of KES 100.5 billion from the previous period's collection.
The national budget on the other hand, which is largely funded by ordinary revenue collected by KRA has grown by 110.5% to KES 1.4599 trillion in 2012/2013 from KES 693.6 billion in 2007-2008.
The Kenya Revenue Authority collected KES 707.3 billion in revenue for the financial year June 2011 to June 2012. This represented a 13% growth in revenue collection compared to the KES 635 billion net in the 2010/2011 financial year.
2012/2013 Budget
This years' national budget is KES 1.4599 trillion which the Finance minister Njeru Githae said is to be financed by the revenue collected (KES 707.3 billion); and loans and grants both local and foreign. Githae said that the fiscal framework for 2012/2013 is fully financed and there is no financing gap. The overall fiscal deficit for 2012/2013 is KES 250.3 billion (6.5% of GDP) which the minister says will be financed by net foreign financing of KES 143.6 billion and KES 106.7 billion net borrowing from domestic market.
The table below shows targets and revenue KRA has collected and the national budget over the past 5 financial years.
Inconsistency
Treasury, Kenya Revenue Authority and Auditor General have presented different figures as revenue collected in 2007/2008 prompting a probe into the matter. Mars Group Kenya has recommended an independent forensic audit into the Government’s revenue accounts for the last five years owing to inconsistencies detected on the 2007/2008 revenue. The group told Parliamentary Budget Committee that there are indications that the Government has not been disclosing the actual revenue collected raising queries on its expenditure over the period and has asked for an inquest into government spending for the period 2007-2012.
Targets
KRA has not met its revenue collection target, in the last financial year, or even in the last 5 years except in the FY 2010-2011 when it collected KES 634.9 billion against a revised target of KES 630.7 billion. It attributed the missing of its targets to rising inflation, the volatile exchange rate and mixed performance of the NSE which were directly and indirectly influenced by the global financial crisis over the past five years.
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