Former Laikipia governor Ndiritu Muriithi’s appointment as the Kenya Revenue Authority’s (KRA) new chair represents a positive change in the organisation’s course.
He sets the correct tone in his inaugural address, which focuses on KRA’s transformation into a more professional, equitable and fair institution. However, a thorough overhaul of the taxman’s operations is necessary to make this goal a reality.
The chairperson’s emphasis on the following fundamental values forms a strong basis for institutional change. The values are trustworthy, ethical, competent, helpful, innovative, and simple. However, current difficulties, especially with digital systems like eTIMS, draw attention to the disconnect between practical realities and aspirational objectives.
Despite its importance, digital transformation requires reconsideration. This is aptly demonstrated by the present difficulties with eTIMS implementation. There is a need for more sophisticated strategies when big businesses like Safaricom have already expressed doubts about the system’s viability for millions of M-Pesa transactions.
To become truly user-centric systems that consider Kenya’s diversified economic landscape, the KRA’s digital platforms must advance beyond simple automation.
Treasury Cabinet secretary John Mbadi pointed out significant flaws in KRA’s fundamental systems during a recent tax conference, calling iTax “outdated” and the Integrated Customs Management System (iCMS) “not working”.
Even if new programmes like eTIMS are being put in place to improve tax visibility, the failure of these vital systems points to more serious institutional issues with KRA’s modernisation and technology capabilities.
The KRA’s ability to efficiently track, assess, and collect taxes is compromised by this antiquated and inefficient technological infrastructure, which results in large revenue leaks and compromises the authority’s mission.
It is admirable that the chairperson is committed to using technology to improve the KRA’s facilitative approach. Accessibility and system dependability must be weighed against this, though.
Compliance efforts are hampered by the present issues with complicated interfaces and system outages. The redesigned KRA requires reliable, easy-to-use systems with constant performance, clear navigation, and intuitive interfaces.
Special attention is needed for custom administration, which is an essential part of KRA’s operations. At our ports and borders, the chairperson’s vision of a service-oriented company should be realised through expedited clearance procedures, streamlined processes, and improved stakeholder involvement.
This would increase Kenya’s competitiveness in global trade and improve compliance.
It will take consistent dedication to the chairperson’s vision of a more service-oriented and professional organisation for success in its reengineering endeavour. It necessitates striking a balance between enforcement and facilitation, efficiency and accessibility and technology innovation and practical reality.
The KRA can only genuinely become the firm, equitable, and professional organisation that its new leadership has envisioned with such a balanced transition.
While the chairman’s tax amnesty plan is a step in the right direction, more significant adjustments are needed for long-term fixes. KRA must create unique strategies for different business sectors.
Kenya's high levels of economic informality are not taken into account by the present one-size-fits-all strategy, which is especially noticeable in the eTIMS deployment. Simpler compliance procedures that take into account their operational realities are required for small firms, ranging from market vendors to neighborhood kiosks.
Opportunities for collaborative solutions are created by the chairman's emphasis on strategic alliances between the public and private sectors.
This strategy ought to be applied to system implementations as well, with KRA aggressively obtaining and taking into account stakeholder input prior to introducing new specifications. Better consultation and staggered rollout could have helped to mitigate the issues with eTIMS.
Although it was not specifically addressed in the inauguration address, internal capacity building needs to be a top priority. Employees require training in customer service, business facilitation, and technical abilities. This is in line with the chairman's goal of transforming the organisation from one that is centered on authority to one that is focused on service.
The resolve to use technology "to a greater extent" needs to be balanced with common sense.
Solutions must be realistic and in line with Kenya's economic reality, even though digital revolution is unavoidable. This entails creating systems that are usable by users with different degrees of technical proficiency while reliably handling large transaction volumes.
In order to promote the chairman's objective of increased stakeholder engagement, communication tactics need to be updated. It would greatly increase compliance and lessen conflict with taxpayers if requirements, deadlines, and system changes were communicated in a clear, consistent, and timely manner.
Above all, KRA's reengineering needs to recognize the connection between tax collection and economic performance.
The chairman is cognizant of this interdependence, as seen by his emphasis on forming strategic alliances to strengthen the economy. Instead than depending just on enforcement actions, KRA ought to create plans that encourage company expansion while maintaining compliance.
The writer is a Development Economist and Public Policy Specialist. Email: [email protected]
