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Economy

Kenya reduces annual revenue target for 2018-19 year

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Kenya cut its revenue target for this fiscal year by five per cent to KES 1.61 trillion ($15.7 billion), the second year in a row the East African nation is revising its tax goal downward.

Sunday 06, January 2019

(Bloomberg)--The Kenya Revenue Authority initially sought to raise KES 1.69 trillion in the year through June 2019, Treasury Secretary Henry Rotich said in a notice in the official gazette. It collected KES 1.37 trillion in the previous period, missing a twice-lowered target of KES 1.415 trillion.

Factors such as bleak corporate earnings and job cuts “collectively mean the overall economic activity gets cut, thus net collections are projected downward,” said Deepak Dave, founder of Nairobi-based Riverside Capital Advisory. The inability of the agency to effectively collect various new levies introduced this fiscal year may also have prompted the cut, he said.

Tax income rose 9.2 per cent to KES 555.7 billion in the five months through November, according to the notice. Kenya spent KES 254.2 billion of that amount on public debt service and expects to repay KES 870.6 billion in the full-year period.

TAGS : Kenya Revenue Authority, Henry Rotich, Deepak Dave, Riverside Capital Advisory

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