The Kenya Revenue Authority (KRA) is targeting over three million taxpayers in Western Kenya who either fail to file their returns or consistently declare nil returns. The authority says this trend is depriving the government of an estimated Sh2.2 trillion in potential revenue.
The Western region has the second-highest number of registered taxpayers after Nairobi, which is why the authority has decided to intensify compliance enforcement there, in order to improve revenue collection and encourage taxpayers to meet their obligations.
Ms Esther Wahome, KRA Deputy Commissioner in charge of tax base expansion, said the agency is focusing on taxpayers who have active Personal Identification Numbers (PIN) but have either stopped filing returns or routinely submit nil declarations despite being economically active.
“Our target is on individuals who fall within the taxable bracket but are either not filing returns or remitting taxes. So far, about 3.15 million individual pin holders have been identified as nil filters and non-filers,” said Ms Wahome.
However, as the crackdown gained momentum, the tax authority began recording early gains, with approximately Sh22 billion collected from 38,877 newly compliant taxpayers in the region between July and December last year.
Times Tower in Nairobi, the headquarters of the Kenya Revenue Authority (KRA).
Ms Wahome was speaking during a round table discussion with the media on Tuesday, a forum where other KRA officials were also present.
According to KRA records, there are 22 million registered pins and out of these, only six million pay taxes.
Out of these six million, 3.2 million are in formal employment, meaning the majority have been filing nil returns or not filing at all. These are the people the authority is after.
Some of these people, including students, acquired KRA pins simply because it was a requirement by the government to do one thing or the other.
“We introduced e-TIMS to track Nil Returns filers, and it has helped us identify income generated by KRA PINs linked to them. Recently, taxpayers who attempted to file Nil Returns for 2024 were flagged because recent transactions indicated they earned income in 2025,” Wahome explained.
The agency compared data submitted by employers and their e-TIMS accounts to identify mismatches in their latest returns.
The cleaning up of the tax registration will be completed by the end of March to pave the way for the filing of nil returns.
At the same time, KRA has rolled out measures it intends to explore to expand its tax base to onboard more taxpayers from the informal sector, with a sole aim of easing the pain on the pay slips of millions of Kenyans.
Mr George Obell, Commissioner for Micro and Small Taxpayers, reaffirmed KRA’s commitment to supporting businesses through enhanced services, simplified tax solutions, and continuous public engagement.
He highlighted the introduction of daily Turnover Tax payments to ease cash flow for small businesses and promote timely compliance.
Clients seeking services at KRA headquarters, Times Tower, Nairobi.
Photo credit: File | Nation Media Group
According to Mr Obell, the tax to the Gross Domestic Product has come down from 19 per cent to 14 percent meaning those who are paying taxes are still very few.
The people on payroll are less than 3.22 million, yet the pressure is on them, and their pays lips.
“So far those in formal employment are feeling the pain. Once we onboard more taxpayers who fulfil their obligations, then this will ease the pressure on their pay slips. When more people are contributing, the government can lower some of these tax rates,” said Mr Obell.
Mr Obell said the Authority has decided to focus on the MSMes to mop up taxes that have gone unremitted for years. He pointed out that three to four million people have disposable income but are not able to pay tax.
“We want tax regimes that speak to the lower cadre amplified. We have come up with simplified solutions to tap into the tax bracket that wasn't contributing tax. We are making sure this is done through a softer human nature so that they are aware of their tax obligations,” said Mr Obell.
He stated that the Electronic Tax Invoice Management System (e TIMS) will help businesses keep their records to lower their cost of compliance and help them file their returns.
“They will make payments based on their daily sales, rather than a large lump sum at the end of the month,” said Mr Obell.
This applies to businesses with an annual turnover exceeding Sh1 million but not surpassing or expected to surpass Sh25 million.
