KRA Proposes New IT System to Monitor Daily Business Sales

0
Source: Flickr
Shares

The use of IT services has long been used by the Kenya Revenue Authority (KRA) to meet tax targets and identify tax cheats in the system. The advent of new methods to help businesses work more efficiently has, in some cases, affected the manner taxes and revenues are collected. For instance, IT services and products change rapidly over time that exiting systems become outdated in a short period.

This scenario can be linked to a new proposal by the KRA that seeks to install a new electronic tax register (ETR) for businesses that should complement a similar system that was introduced back in 2005. The new system will send daily sales reports to the taxman for harmonization purposes.

At the same time, KRA says that the necessity to integrate former existing structures is becoming more demanding, bearing in mind that new applications and business functions need to be supported by modern systems. KRA also wants to install a scalable structure that will keep revenue collection processes working for the target areas, which, in this case, are businesses.



According to Business Daily, the proposed system will task businesses to install the new digital system that is linked to the internet. By doing so, KRA will have access to how suppliers’ and manufacturers’ invoices and assess their tax obligations in real-time.

The internet connection will allow communication between POS and invoicing systems with KRA. In other words, the integration system dubbed TIMS will link up businesses registers, billing, and invoicing registers with iTax that will see both parties are on the same page.

If the proposal is approved, then all traders whose businesses have a turnover of more than KES 5 million will be required to install the new ETRs. This will enable KRS to get access to sales data on a daily basis – all in the name of full financial disclosure and visibility.


Of course, the financial burden to buy and operate the new system will be shouldered by taxpayers.

The mission by the KRA to meet its tax targets in accordance with the law such as the VAT Act 2013 is a complex task because of the massive number of taxpayers, as well as the number of rules that are applied to each case, most of which are unknown to the public.

Shares

LEAVE A REPLY

Please enter your comment!
Please enter your name here

This site uses Akismet to reduce spam. Learn how your comment data is processed.