cg's speech 2008 - kenya revenue authority€¦ · · 2015-09-28revolutionised document...

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REMARKS BY MR. M. G. WAWERU, E.B.S.,

COMMISSIONER GENERAL, KENYA REVENUE

AUTHORITY, DURING THE YEAR 2008

TAXPAYERS’ AWARDS CEREMONY

TUESDAY 21ST OCTOBER, 2008 AT BOMAS OF

KENYA, NAIROBI

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� Your Excellency the President and Commander-in-Chief of the Armed Forces of the Republic of Kenya, Hon. Mwai Kibaki, C.G.H., M.P.;

� The Minister for Environment and Mineral Resources and Acting Minister for Finance, Hon. John Michuki, E.G.H., M.P.;

� Honorable Ministers Present;

� Permanent Secretaries Present;

� Your Excellencies the Ambassadors, High Commissioners and Diplomats;

� Chief Executives of Top Taxpayer Companies;

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� Distinguished Taxpayers;

� Commissioners General from the East Africa Revenue Authorities;

� Invited Guests;

� Members of the Board, Management and Staff of Kenya Revenue Authority;

Ladies and Gentlemen:

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Your Excellency Sir,

Allow me at the very outset to begin by taking this opportunity,

on behalf of the Kenya Revenue Authority fraternity, to express

our sincere gratitude and appreciation to your Excellency Sir,

for not only agreeing to preside over this year’s Distinguished

Taxpayers’ Awards Ceremony, but also the unrelenting support

and guidance you have continued to extend to KRA.

Sir, your passionate appeal to Kenyans to pay all their taxes

and set this great country free, has continued to resonate

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across the country with a very clear message of voluntary

compliance. It is our resolve at Kenya Revenue Authority to

consolidate all the gains we have made with regard to taxpayer

loyalty and voluntary tax compliance.

Kenya Revenue Authority set aside the week of 13th to 21st

October 2008 to thank and appreciate all our taxpayers for

extending their unwavering support to the Authority, and also

to showcase the KRA’s reform and modernisation initiatives.

Besides, KRA officials have taken time to visit a number of

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children’s homes and orphanages countrywide, as part of the

Authority’s Corporate Social Responsibility. Your Excellency Sir,

we are cognisant of the fact that it is the society that gives KRA

the mandate to exist and operate and it is therefore important

that as a responsible corporate citizen, we share a proportion

of our modest resources with the less privileged members of

the society.

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The theme of this week’s activities is Tulipe Ushuru,

Tujitegemee in line with the Authority’s new rallying call. As

may be appreciated, this theme is an improvement on last

year’s, which was Kulipa Ushuru, ni Kujitegemea. Your

Excellency Sir, the essence of this improvement is that, for the

last few years, KRA has been trying to sensitise Kenyans on the

need to pay all their taxes to enhance the country’s financial

independence.

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Judging from the number of taxpayers who have since decided

to comply voluntarily, we believe that the message has been

well received. Tulipe Ushuru, Tujitegemee, is therefore, an

effort toward consolidating the voluntary tax compliance

culture among Kenyan taxpayers, by appealing to them to take

charge of their destiny.


Only yesterday, Kenyans from all walks of life gathered in

various centers countrywide to celebrate the 45th anniversary of

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Kenyatta Day, a day to remember the sacrifices made by our

freedom heroes and heroines, who gave up leisure to liberate

the country from the bondage of colonialism. The political

freedom was won on the platform of eradicating poverty,

ignorance and disease.

Whereas the country has made tremendous strides in the areas

of Universal Free Primary Education, and economic

management, the war on HIV Aids, Malaria and a host of other

diseases is still far from being won.

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The fight against poverty is still going on and although its

incidence has been reduced considerably in the last few or so

years, a large number of our people are still living below the

poverty line. We require more financial resources to accomplish

the dream of the architects of the struggle for independence,

and enhance the quality of life for all our people, while at the

same time ensuring that our children do not die from

preventable diseases.

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As the main revenue collection agency for the Government,

KRA is committed to ensuring that it plays its rightful role in

mobilisation of the requisite domestic financial resources to

enhance the country’s financial independence. In this regard, I

wish to call upon all taxpayers and other stakeholders to

continue supporting KRA to discharge its mandate effectively

and efficiently.

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The vision of Kenya Revenue Authority is to be the Leading

Revenue Authority in the World Respected for

Professionalism, Integrity and Fairness. This vision gives

us the motivation to endeavour for global leadership in tax

administration practices. Towards this end, KRA has in the

recent years, consistently modernised revenue collection

methods with a view to enhance service delivery to its

customers. The reform agenda has now come full cycle, and

provided a reliable platform for enhanced information sharing.

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Among the very first reform and modernisation initiatives was

the integration of the then semi-autonomous Income Tax,

Value Added Tax and Domestic Excise to create Domestic

Taxes Department. The merger and consolidation of functions

has enabled the department to have a single view of the

taxpayer, and minimise the number of visits and time spent by

tax audit teams at the taxpayers’ premises. Consequently,

taxpayers can now spend more time on their businesses, and

worry less about the visits by tax officers.

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The carving out of the Large Taxpayers Office (LTO) from the

Domestic Taxes Department in 2006 was aimed at providing

specialised services to taxpayers, based on their unique needs,

in terms of size, contribution to total revenue collection, and

sector. The LTO concept has tremendously improved

specialisation, and through the taxpayer segmentation

approach, facilitated better understanding between KRA and

taxpayers.

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Similarly, the introduction early this year of Turnover Tax

(TOT), targets small taxpayers who face tremendous

challenges with regard to cost of compliance, record keeping,

and their migratory nature. The TOT has simplified tax

payment, and ensured that small taxpayers are not subjected

to rigorous requirements that are applicable to large taxpayers.

This has ultimately reduced costs involved in determining tax

liability and filing of tax returns, and is expected to greatly

improve tax compliance in this sector.

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I want to appeal to all small taxpayers to embrace this tax so

that we can quickly put behind us the hide-and-seek games

that characterised the relationship between tax officials and

taxpayers in the yester years.

Kenyans will recall that the introduction of the Electronic Tax

Register was met with acrimony and suspicion, and for the first

time in the history of tax administration in this country,

compliant taxpayers were taken with surprise as they

witnessed street demonstrations against KRA.

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Taxpayers can now agree with me that contrary to the

misconception that ETR was intrusive, expensive and only

meant to safeguard government revenues, the reality is that

the device helps in self-supervision and monitoring of business

transactions.


We have undertaken a wide range of reform initiatives in the

Customs Services Department, aimed at not only supporting

the Authority’s mandate of revenue collection, but also

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facilitating trade, compilation of international trade statistics,

and protection of our borders from the threats of terrorist

activities and entry of harmful substances. In this regard, we

are happy that the Simba System of electronic Custom

clearance introduced in 2005 is fully operational, and has

revolutionised document processing and cargo release times.

The Road Transport Department has also made considerable

strides in reform and modernisation agenda.

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The department has in the last four years put in place

document scanning and imaging that helps to electronically

process and retrieve information on registered motor vehicles

and drivers. In 2006, KRA unveiled a security printed and

electronically produced new generation Log Book. Many more

initiatives are underway; all aimed at improving service delivery

to the customer, and reducing the perennial long queues and

missing files, previously associated with the department.

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KRA enjoys cordial working relationships with other

government agencies, and revenue authorities within the East

Africa region on all aspects of tax administration as well as in

the fight against terrorism and trafficking of drugs and harmful

substances. In this regard, I want to sincerely salute all the

Commissioners General and delegations from the regional

Revenue Authorities, who are in our midst today. The Authority

also enjoys a good standing among its peers both from within

the African continent and internationally as attested to by the

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numerous partnerships and information exchanges enjoyed

with global institutions such as World Customs Organisation

(WCO), Commonwealth Association of Tax Administrators

(CATA) and Inter-American Centre for Tax Administration

(CIAT), just to mention but a few.


Your recent directive to have Kilindini Port and all other

Customs border stations to operate twenty four hours has been

fully complied with.

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In this regard, I wish to report that between the 18th of August,

when the 24 hour directive came into force and 15th October

this year, a total of 33,644 containers and 11,939 motor vehicle

units had been cleared to exit the Kilindini Port. On average

about 39% of all the goods are moved at night while 61% are

moved during the day. I am also happy to report that all the

government agencies and other stakeholders, including the

Kenya Police, Kenya Bureau of Standards, Kenya Ports

Authority and KIFWA have embraced the 24-hour operation.

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However, discussions are still on-going under the auspices of

East African Community Secretariat to make the necessary

legislative changes to the East African Community Customs

Management Act in a bid to ensure full take-up of the 24-hour

operation by all the countries within the region. Since the

commencement of the 24 hour operations at the port, both

KPA and ourselves have observed an increase in “transit” cargo

as a percentage of the total cargo.

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We are investigating this phenomenon since economic realities

do not support it. We shall catch up with those agents who

may be declaring cargo destined for their warehouses in

Nairobi and Mombasa as transit in order to evade the payment

of full Port charges and taxes.

Regarding the perennial backlog in VAT refunds, I wish to

report to you Sir that KRA has already put in place a task force

to streamline refund processes.

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In order for us to realise this objective, there is urgent need

for availability of financial resources in proportion to

outstanding claims. We shall be holding discussions with our

Principal, The Treasury, in order to agree on the resources

needed and how they shall be availed. I would like to assure

you Sir that we shall fully comply with your directive within the

stipulated time frame.

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Kenya Revenue Authority is gratified by the sacrifice and

commitment demonstrated by the organisations which are

going to be awarded today, in mobilising their resources to

support the national objective of making our country financially

self reliant. The awards are based on the following criteria:-

� Embracing and supporting tax reform and modernisation

programmes being implemented by Kenya Revenue

Authority.

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� Absolute amount of taxes paid.

� Outstanding growth in revenue.

� Voluntary compliance with tax legislation.

� Cooperation with auditors and compliance officers from

KRA.

� Collaboration in fight against illicit trade.

� Timely filing of returns and

� Remarkable accuracy of tax returns among others.

While commanding the awardees for a job well done, I wish to

encourage other taxpayers to continue pursuing the path of

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excellence in handling their tax matters, as there will be yet

another opportunity to win an award.

In conclusion, Your Excellency Sir, I wish to once again thank

you for your unwavering support which symbolises the much

desired political support for the Revenue administration. I

believe with similar support from leaders down the hierarchy,

we shall always meet and surpass our targets, for the good of

our country.

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I now wish to call upon the chairman of the KRA Board of

directors Mr. Leonard Mwangola to make his remarks.

Tulipe Ushuru, Tujitegemee.

Thank You

M.G. WAWERU,

EBSCOMMISSIONER GENERAL

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