Kenya begins search for new taxman amidst cashflow concerns

The Kenya Revenue Authority (KRA) has begun the search for a new Commissioner-General at a time of cashflow challenges that has seen the government delay salaries of public servants and withhold county allocations. 

The recruitment comes after former KRA boss Githii Mburu made a shock exit late February on institutional reforms taken by the Kenya Kwanza government that has seen senior officials of the taxman edged out.

The new regime removed chair Francis Muthaura to pave way for Anthony Nganga Mwaura—President William Ruto’s ally and pushed out Lilian Nyawanda (Commissioner, of Customs and Border Control), Terra Saidimu (Commissioner, Intelligence and Strategic Operations) and David Kinuu (Commissioner, Corporate Support Services).

Drastic changes at the taxman at a time of high inflation, slow economic growth has seen the authority struggle to meet tax targets even as debt repayments pile pressure on exchequer collections. 

The taxman said it collected Kes1.554 trillion as of the end of March 2023 about 95 percent of its target which has not been sufficient to help government meet debt payments and pay civil servant salaries.  

Read also: State House puts pressure on KRA to revoke tax evasion clampdowns

“The authority seeks to recruit the Commissioner-General, who as the Chief Executive Officer, will lead the institution through its transformative journey,” the call for applications signed by Board Chairman said.

Mr Mburu’s successor will be charged with among others providing leadership to the authority at a time when the taxman is coming under intense pressure from the executive to meet high revenue collection targets to finance Kenya Kwanza administration’s programmes. 

The successful candidate will be offered a five-year contract, which is renewable once upon satisfactory performance.

Since Mr Mburu’s exit at the authority’s hot seat on February 23rd, Ms Rispah Simiyu, who was the Commissioner of Domestic Taxes, was appointed to work as the acting Commissioner-General.

As a CEO, the successful candidate will be expected to oversee the day-to-day operations at the Authority and potential successors to Mr Mburu have until 25th April to lodge their applications.

During his term, which barely lasted four years at KRA, Mr Mburu earned praise and criticisms in equal measure but later found his position increasingly untenable following his perceived aggressive pursuit of tax cheats who turned out to be the current regime’s top supporters.

The influential businessmen managed to lobby the new government to order KRA to reopen 25 alcohol manufacturers shut down under President Uhuru Kenyatta’s anti-counterfeit and tax evasion crackdown.

This has sent mixed signals in the market especially given President Ruto has also been pushing for tighter tax evasion fight to seal revenue loopholes.

Late last year, Dr Ruto told top taxmen, the bulk of whom have since left Times Tower following a shake up, that it was unbelievable that Kenya—the largest economy in Eastern Africa—was selling just 2.9 billion excise stamps per year compared with Tanzania’s “seven” billion and Uganda’s “nine” billion. The President projected KRA should be selling between 10 and 12 billion stamps to manufacturers and importers.

“There are people who are selling the balance which is approximately seven billion stamps. I have told the Commissioner-General (Githii Mburu) he must tell these people to stop. I do not want to fight with people,” said the President.

Some of the high-profile cases that Mr Mburu pursued under former President Kenyatta’s term involved Kes17 billion claim against liquor manufacturer Africa Spirits Ltd which is associated with tycoon Humprey Kariuki. Africa Spirits Ltd has remained shut since late January 2019. Mr Kariuki has since been appointed as one of the 12 members of the National Investment Council under Dr Ruto’s government.

Mr Mburu also pursued Naivasha-based Keroche Breweries, paralysing the company and shutting down its operations at least three times citing up to Kes22.79 billion tax arrears.

Overall, in just over three years, Mr Mburu compiled over 4,000 tax investigations with a combined Kes500 billion in tax arrears.

The next occupier of the KRA Commissioner-General’s office on 30th floor at Times Tower, Nairobi, will be expected to promote tax administration practices that facilitate trade and business growth. One will also be expected to build and sustain sound working relationships with taxpayers, government agencies, and other stakeholders.

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