The Kenya Revenue Authority (KRA) has recovered over KES 120 million following an internal excise stamp theft scheme. This follows an audit that revealed that millions of stamps reported as lost in October 2024 were actually unaccounted for, exposing a well-orchestrated syndicate operating within Times Tower.

“The exercise culminated in the recovery of KES 120,278,879 and decisive action against seven members of staff implicated,” KRA said in a statement.

One staff member has since been dismissed following the conclusion of disciplinary proceedings, while additional cases remain under review. Seven others have been interdicted to allow for further investigations.

KRA said the discrepancies were not the result of a single incident but stemmed from accumulated control failures spanning several years, particularly between 2022 and 2024.

Further investigations traced the origins of the scheme to around 2015, when KRA transitioned from a manual system to the automated Excise Goods Management System (EGMS). A joint stock-take with the system service provider during the migration revealed variances that had neither been reported nor reconciled.

“Faults in manual processes created opportunities for irregularities in the receipt, custody, and issuance of excise stamps. Findings pointed to systemic lapses in reconciliation and reporting mechanisms at the time,” the Authority noted.

To tighten oversight, KRA has directed corrective action from the EGMS service provider, including the replacement of its representative stationed at the excise stamp vault.

The excise regime remains a key pillar of government revenue, accounting for 6.9 percent of ordinary revenue collections from VAT, excise duty and other taxes. In the last financial year, KRA collected KES 69 billion in domestic excise revenue, achieving a performance rate of 97.2 percent.

In response to the breach, the Authority has rolled out a series of reforms, including strengthening internal controls on the receipt, storage, issuance and reconciliation of excise stamps, and enhancing automation within the EGMS to support real-time tracking.

KRA has also introduced monthly stock reconciliations and audit checks, conducted a system-wide audit to address remaining vulnerabilities, and expanded collaboration with law enforcement agencies to support ongoing investigations.

“These measures are designed to close historical gaps and ensure that excise stamp management is fully secure, transparent, and aligned with global best practices,” KRA stated.

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