Kenyatta Urges Review of Tax Regime to Foster Compliance, Safeguard SMEs

12 December 2019

Nairobi — President Uhuru Kenyatta has directed all employer contributions and deductions from employees' salaries be submitted to the Kenya Revenue Authority (KRA) through a unified system.

The deductions, which include those of National Social Security Fund (NSSF), National Hospital Insurance Fund (NHIF) and Pay As You Earn, are to made through a unified payroll to ensure compliance on the part of employers.

Kenyatta who spoke during the Jamhuri Day national celebrations at Nyayo National Stadium on Thursday also ordered the National Treasury and KRA to review existing tax structures, especially in relation to MSMEs, to reduce the tax burden while fostering tax compliance.

The move, he said, will spur growth in the sector.

"To accelerate economic transformation, my Administration is focused on other salient factors that are holding back the potential of our enterprises; particularly with regard to taxes and tax administration, reduction or where possible elimination of fees or charges levied by Government Agencies as well as the Private Sector," Kenyatta said.

His sentiments on taxes are similar to those proposed on the recently launched Building Bridges Initiative report which recommended the broadening of the tax base and lowering the tax rate.

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