Kenya is set to revolutionize its revenue collection process by adopting an artificial intelligence (AI)-driven tax system within the next two years. Presidential Council of Economic Advisors Chairperson David Ndii announced on Friday, October 31, that the government plans to use algorithms to automate tax assessment and collection, marking a significant shift in Kenya’s fiscal operations.
Speaking during a stakeholder engagement, Ndii explained that the transition to AI-based tax systems forms part of the broader government strategy to expand the country’s tax base and make revenue collection more efficient.
“In a year or two, most of our taxes will be collected by algorithms and not by people. We are not planning to collect taxes the old way,” Ndii stated. “We are going to collect taxes by algorithms.”
According to Ndii, the move is made possible by Kenya’s high penetration of digital finance, particularly mobile money platforms like M-Pesa. This digital ecosystem provides a strong foundation for deploying AI and machine learning tools to streamline tax collection.
He emphasized that traditional methods of collecting small taxes, especially from the informal sector, have proven inefficient due to administrative costs. With AI, however, these small-scale taxes can now be collected passively and automatically.
Ndii further revealed that the Kenya Revenue Authority’s (KRA) role will evolve from enforcement to systems management, as technology assumes more operational responsibilities.
Beyond automation, the government is also reviewing the Value Added Tax (VAT) structure to favor consumers directly instead of manufacturers. “Technology now allows us to give VAT refunds to consumers directly. For us to give you a tax credit, you must first be a taxpayer,” Ndii said.
The planned AI-driven system reflects President William Ruto’s administration’s growing commitment to digital transformation and fiscal innovation, positioning Kenya as a regional leader in tech-enabled governance.
