KRA to Collect Taxes on Behalf of Counties

The Kenya Revenue Authority will start to collect land rates and other taxes charged by counties in an effort to streamline revenue collections and reduce cases of tax evasion. The National Treasury has drafted new regulations linked to the Property Tax Act with an aim to increase revenue collection.

The Rental Income tax came into effect in 2016 but compliance has been slow. Property owners have been using loopholes in the act to evade paying taxes. As a result, KRA has embarked on a journey to seal the gaps and apply more enforcement mechanisms.

Under the new regulation, property owners who earn more than KSh10 million property income will start to pay the Rental Income tax.  

In an effort to improve property tax compliance, the revenue authority has increased its engagement with land and rental property owners through awareness campaigns and educational forums.

KRA further says its using all available avenues to increase tax collection after it missed its target in the first half of fiscal year 2018/2019. Some of the techniques the agency is using include expanding its tax base, and sealing gaps used to evade taxes.

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