KRA surpasses KES 2 Trillion mark, records 6.1pc growth in revenue collection

The Kenya Revenue Authority (KRA) has recorded a significant milestone, collecting Kshs 2.112 trillion in revenue by April 30, 2025. This marks the first time the authority has crossed the Kshs 2 trillion mark, representing a 6.1 percent growth compared to Kshs 1.990 trillion collected in the same period of the 2023/2024 financial year.

Despite falling slightly short of its Kshs 2.189 trillion target, the collection reflects a strong performance rate of 96.5 percent .

Domestic taxes brought in Kshs 1.386 trillion between July 2024 and April 2025, a 4.7 percent increase from Kshs 1.323 trillion during the same period in the previous year. Customs revenue also saw robust growth, rising by 9.1 percent to reach Kshs 722.743 billion, up from Kshs 662.447 billion.

Revenue collected on behalf of other government agencies stood at Kshs 205.518 billion, surpassing the Kshs 183.789 billion target with a performance rate of 111.8 percent—a remarkable 37.1 percent growth year-on-year. Exchequer revenue totaled Kshs 1.906 trillion, showing a modest growth of 3.6 percent .

KRA noted that while revenue has increased, economic headwinds have impacted performance. Kenya’s GDP grew at a slower pace of 4.0 percent in Q3 2024, down from 6.0 percent in Q3 2023. The Purchasing Managers Index (PMI) averaged 49.8 during the period, signaling a contraction in private sector activity. A 1.6 percent drop in import values and subdued export earnings further dampened revenue growth.

The authority cited challenges such as high commercial bank lending rates, which averaged 17.22 percent despite the Central Bank’s efforts to ease monetary policy. Meanwhile, tax refunds and adjustment vouchers worth Kshs 53.8 billion reduced effective collections.

KRA also pointed to policy changes affecting the PAYE tax base, including the reclassification of the SHIF and Housing Levy as allowable deductions rather than tax reliefs.

Despite these challenges, KRA credits several reforms for improved revenue performance. These include the Centralized Release Office, which enhanced cargo clearance efficiency, contributing to a surge in customs revenue growth in March 22.6 percent and April 14.4 percent.

The rollout of the Electronic Rental Income Tax System (eRITS) has made it easier for landlords to file taxes, while the Tax Amnesty Programme collected Kshs 13.5 billion and waived Kshs 164.9 billion in penalties and interest, benefiting over 3 million taxpayers.

The adoption of the Electronic Tax Invoice Management System (eTIMS) has curbed VAT fraud and improved compliance, while a reformed Dispute Resolution Framework helped unlock Kshs 21.9 billion in previously contested revenue.

KRA aims to collect Kshs 2.668 trillion by the end of the 2024/2025 financial year and remains optimistic about sustaining its upward trajectory to support Kenya’s economic stability