The Kenya Revenue Authority (KRA) is set to start collecting real-time data on traders’ daily sales using new technology following the publication of a new law that allows the taxman to monitor transactions using Internet-enabled electronic tax registers.
The new regulations will require businesses to install the new electronic tax registers which are connected to KRA for monitoring. Electronic tax registers are a requirement for all businesses with an annual turnover of Sh 5 million as stated by the new regulations published by Treasury Cabinet Secretary Ukur Yatani on Friday.
Under the new system, the KRA will be able to receive sales and data from registered companies and traders on a daily basis in real-time. This move is basically implemented in a fresh to boost revenue collections and curb tax evasion.
“A register shall be capable of integrating with the authority’s systems,” Mr Yatani, Treasury Cabinet Secretary said. “It shall be capable of transmitting to the authority’s system the tax invoice data and the end of day summary of the respective day’s data in the manner specified by the Commissioner.”
The new system will be an upgrade of the current manual tax registers that store sales data for scrutiny by the KRA after 30 days.
“The new electronic tax registers are expected to seal tax loopholes which have seen KRA fall short of achieving its target year in year out. The situation has worsened even further with the advent of the coronavirus pandemic. KRA fell short of Sh40 billion in taxes in July and August.” Business Daily reports.
All businesses will be expected to have installed the new electronic tax registers connected by September next year.
“Traders will also be required to seek the taxman’s permission to perform any other business the next day under the system, meaning incorrect or incomplete data logged the previous day could lock them out. The KRA will also start receiving real-time data on motor vehicle purchases, property deals and real estate investors seeking electricity meters after integrating its system with other agencies,” Business Daily report added on the new KRA tracking system.