Kenya Revenue Authority set for system upgrade to curb tax evasion
Kenya’s taxman the Kenya Revenue Authority is replacing the tax collecting platform Simba System and replacing it with a modern integrated customs management system as it cracks the whip on tax evasion.
This even as the Authority insisted that Simba System, which is usually relied on by customs agents, had become prone to manipulation and misuse including being used to evade tax.
According to the KRA Commissioner for Customs and Border Control Julius Musyoki the system also experiences prolonged downtime, leading to delay in movement of cargo from the port of Mombasa.
“Implementation of the new integrated customs system will start at the end of next month, when we will do the piloting before commissioning it in June,” said Mr Musyoki.
He further added that the new system, whose implementation is being financed through an $11 million financing from the Government and TradeMark East Africa, will be fitted with special features to carry out automated evaluation of the value of cargo to help address the perennial challenge of cargo under-valuation. Other benefits of the new system include being able to integrate to the Regional Electronic Cargo Tracking Platform.
The platform, which has already been agreed by Kenya, Uganda and Rwanda, will use one system that enables all countries to monitor the movement of cargo from the Mombasa Port to its final destination.
“This approach will eliminate the opportunities presently exploited by tax evaders at the changeovers of seals at boarder points by having only one common seal and joint enforcement teams to police transit cargo operations,” said Mr Musyoki.
Movement of goods Widespread abuse of the Simba System has been blamed for loss of revenue, with some experts putting the figure lost annually at more than $66 million. WCO pledged to increase technical assistance in speeding up movement of goods by incorporating agencies such as KRA into its ICT network.
The organisation’s Secretary General Kunio Mikuriya said implementation of the World Trade Organisation’s trade facilitation agreement will start this week as more countries are expected to ratify it.