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Tax Rebellion: Kenyans Brave Heavy Fines in Defiance of KRA Rules(List)
The present administration is focused on broadening the tax base to generate additional revenue, aligning with its goal of funding operations primarily through raised revenues rather than loans.
The Kenya Revenue Authority (KRA) is the institution authorized by the constitution to collect taxes and ensure that all eligible individuals contribute equitably to the development of the nation.
In pursuit of this objective, the tax authority delineates tax violations along with the corresponding penalties associated with each transgression.
As stated in a guideline available on the KRA website, failing to submit Pay as You Earn (PAYE) on time results in a penalty equivalent to 25% of the tax owed, with a minimum penalty of Ksh 10,000 or whichever amount is greater.
On the flip side, individuals who make late payments for PAYE tax will incur a penalty equivalent to 5 percent of the tax owed, coupled with a monthly interest rate of 1 percent.
Conversely, individuals who neglect to subtract Withholding VAT and Withholding Rental Income Tax are obligated by KRA to remit 10 percent of the owed tax.
Individuals who delay payments of Withholding Tax (including Withholding Income Tax, Withholding VAT, and Withholding Rental Income Tax) are subject to a penalty of 5% of the amount owed.
At the same time, failure to submit Monthly Rental Income Tax (MRI) returns on time results in a penalty of either 5 percent of the owed tax or Ksh2,000, whichever amount is greater, for individuals. Likewise, non-individuals face a penalty of either 5 percent of the tax owed or Ksh20,000, whichever is higher, for the same offense.
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Similarly, in the case of tardy payment of MRI, an individual is subject to a fine equal to 5 percent of the owed tax along with an interest rate of 1 percent per month.
On the flip side, individuals in Kenya who fail to pay Stamp Duty on time must settle a fee equal to 5% of the outstanding duty. Similarly, late submission of Excise Duty returns incurs a penalty of either 5% of the owed tax or Ksh 10,000, whichever amount is greater.
Failure to pay the Exercise Duty Tax on time results in a penalty equal to 5% of the tax owed, along with an additional interest charge of 1% per month.
Additionally, there is a penalty for the delayed submission of VAT Returns, amounting to either 5% of the tax owed or Ksh 10,000, whichever is higher. Similarly, late payment of VAT tax incurs a penalty of 5% of the tax due and an interest of 1% per month.
A fine of 5% of the owed tax amount or Ksh20,000, whichever is greater, is imposed for the delayed submission of income tax company or partnership returns.
Additionally, non-individuals incur a penalty of 5 percent of the owed tax and a monthly interest of 1 percent for late payment of Income Tax.
The Kenya Revenue Authority (KRA) additionally states that non-residents who are discovered to have delayed payment of income tax must pay a penalty equivalent to 5 percent of the tax owed, along with an interest charge of 1 percent per month.
In summary, every violation related to the KRA PIN incurs a fine of Ksh2,000 per infraction.
Tax Rebellion: Kenyans Brave Heavy Fines in Defiance of KRA Rules(List)