At least 2.8 million taxpayers will get automatic waivers in Kenya, for accrued interest and penalties amounting to Sh230 billion at the end of the ongoing 10-month tax pardon in June 2024.
The Kenya Revenue Authority(KRA) has confirmed that the beneficiaries will be companies and individuals who have paid principal taxes for the period ending December 2022, according to KRA guidelines for the partial amnesty which opened in September.
“In the sensitisation, we have heard about taxpayers who only have penalties and interest outstanding and who will get automatic amnesty,” said Caroline Rotich, chief manager in the Domestic Taxes Department at KRA”.
“So we have about 2.8 million taxpayers with about Sh230 billion, which will be waived for them.
“There are taxpayers who only have penalties and interest outstanding who will get automatic amnesty.”
The present administration has under the Finance Act 2023 extended the pardon on accrued penalties and interest, which applies automatically for taxpayers who have cleared all the debts owed for the period ended in December, while those with pending bills are required to apply.
Accordingly, those applying for the amnesty will be required to pay the outstanding debts in whole or propose a payment plan, which should be honoured by the end of June for the bills to be waived.
The outstanding amount is part of the estimated Sh1.4 trillion debt that KRA says it is owed by taxpayers within the Domestic Taxes Department, which handles income and value-added taxes.
“Some of the cases are in courts, and so we are not able to collect from them,” said Ms Rotich.
“There are some, which have issues that need to be sorted, probably [tax] return amendments and other issues that have made us not able to collect these taxes in the past.”
About 17, 000 taxpayers with principal tax arrears of Sh10.1 billion had applied for the tax amnesty since the window opened in September by the start of last week and had paid Sh3.4 billion.
The remainder of Sh6.7 billion for those who had already applied should be cleared by June 2024 for the debt forgiveness on penalties and interest to apply.