Mbadi Urges KRA to Embrace Innovative Technology to Boost Tax Collection

National Treasury and Economic Planning Cabinet Secretary John Mbadi has emphasized the critical role of technology in enhancing tax collection and improving the overall efficiency of the Kenya Revenue Authority (KRA). In a recent meeting with KRA officials, Mbadi highlighted the need for continuous modernization in tax administration to streamline business processes and simplify tax transactions.

Mbadi’s call comes at a time when Kenya is grappling with the challenges of increasing its tax revenue to support economic growth and development. He stressed that the modernization journey must align with the objectives of both the government and taxpayers. “Our modernization journey must align with our objectives and those of taxpayers. This approach will not only benefit taxpayers but also significantly boost our revenue mobilization efforts,” said Mbadi.

The cabinet secretary pointed out that adopting innovative technology is essential to broadening the country’s tax base, a move that would protect existing businesses from excessive taxation. By expanding the tax base, the government can distribute the tax burden more equitably across the economy, ensuring that all eligible taxpayers contribute their fair share.

The push for modernization and technological advancement in tax administration is expected to raise Kenya’s tax-to-GDP ratio from the current 11.5% to a more sustainable level in the medium term. Mbadi reiterated the government’s commitment to achieving this goal by leveraging technology to enhance revenue collection. “I will in the course of the fiscal year chair the meeting of the Steering Committee on the Implementation of the Medium-Term Revenue Strategy to ensure we are all on track. The objective is to achieve a tax-to-GDP ratio of 20 percent over the medium term,” he added.

KEEP READING:  Safaricom’s Expanding 5G Network: Paving the Way for Kenya’s Digital Economy

The Medium-Term Revenue Strategy (MTRS) is a critical component of the government’s broader plan to reform the tax system and increase revenue generation. By focusing on technology-driven solutions, the strategy aims to create a more efficient and transparent tax administration system that can respond to the evolving needs of businesses and taxpayers.

KRA Commissioner General Humphrey Wattanga echoed Mbadi’s sentiments, emphasizing the authority’s commitment to revamping its IT infrastructure to establish reliable systems capable of meeting the demands of modern business environments. According to Wattanga, the adoption of cutting-edge technologies such as data science, machine learning, and Artificial Intelligence (AI) will play a pivotal role in enhancing KRA’s operational efficiency.

“The adoption of cutting-edge technologies, such as data science, machine learning, and Artificial Intelligence (AI), will strengthen our operational efficiency, ensure compliance, and elevate service delivery standards,” said Wattanga. He added that these technological advancements would not only simplify tax administration but also boost overall revenue performance and create a seamless experience for taxpayers.

Wattanga also highlighted the importance of using technology to enhance compliance and reduce tax evasion. By leveraging advanced data analytics and AI, KRA can identify potential tax evaders more effectively, ensuring that all taxpayers are held accountable. This approach will not only increase revenue collection but also promote fairness in the tax system.

The deployment of innovative technology in tax administration is expected to have far-reaching benefits for Kenya’s economy. It will enable KRA to efficiently manage the growing volume of tax transactions, reduce administrative costs, and provide better services to taxpayers. Moreover, a more streamlined and transparent tax system will enhance the business environment, encouraging investment and economic growth.

KEEP READING:  A Testament to the Power of Persistence and Small Savings

As Kenya continues to face economic challenges, the government’s focus on modernizing tax administration through technology is a crucial step towards achieving its revenue targets. By aligning with global best practices and leveraging the latest technological advancements, KRA can play a pivotal role in driving the country’s economic development and securing a sustainable future for all Kenyans.

Related Posts
Living with Nigeria’s Blackouts: Six Weeks Without Power

Electricity blackouts have long been a part of life in Nigeria, but for residents and business owners like Chidinma Emeneka Read more

Watu Simu Reaches Million-Device Milestone, Propelling Kenya’s Digital Economy

Watu Simu, a subsidiary of Pan-African asset finance firm Watu, recently crossed the milestone of financing over one million mobile Read more

Kenya-EU Economic Partnership Agreement: A Pathway to Diversified Exports and Economic Growth

In recent years, the Economic Partnership Agreement (EPA) between Kenya and the European Union (EU) has opened new doors for Read more

DCI Honored as Top Government Agency in Tax Enforcement by KRA

On November 1, 2024, at an illustrious gathering at State House, Nairobi, the Kenya Revenue Authority (KRA) honored the Directorate Read more

New Sugar Act Allocates 15% of Levy to Boost Development in Cane-Producing Areas

President William Ruto assented to the new Sugar Act 2022, a pivotal legislation aimed at revitalizing Kenya's struggling sugar industry. Read more

Kenya’s Key Authorities Collaborate for Enhanced Trade and Economic Competitiveness

In an effort to propel Kenya's trade and economic landscape forward, four of the nation’s pivotal institutions the Kenya Bureau Read more