The Kenyan government Christmas gift to Kenyans will arrive tomorrow in the form of a new tax policy. In October, Senior Economic Advisor to President Ruto, Moses Kuria, announced a new policy that will designate all digital payment systems as virtual electronic tax receipts (ETR) systems starting December 25th, 2024.
This Christmas gift will mean services such as M-Pesa Paybill, Airtel Money Paybill, Bank PayBill, Till numbers and other merchant payment systems will be deemed as ETR systems. Basically, all payment service providers (PSP) will be affected by the new policy.
Back in October Kuria said, “Please whisper to them that come Christmas 2024, all pay bills will also be virtual ETRs for purposes of KRA,”
Electronic Tax Registers (ETRs) are cash registers with built-in fiscal memory that record all transactions in real time, enabling accurate VAT accounting at the point of sale and facilitating tax compliance monitoring.
Kenyan tax law mandates VAT registration and ETR device acquisition for any individual or business with an annual turnover of Ksh 5 million ($38,687) or more in taxable goods or services.
iTax Mobile Number Verification
This announcement followed a June drive by the Kenya Revenue Authority (KRA), mandating all registered taxpayers in the country to authenticate their phone numbers on the iTax system.
The authority shared a press release stating, “KRA reminds all taxpayers that further to our public notice on ‘Taxpayer Register Data Clean up Exercise’ dated June 24, 2024, all registered taxpayers are required to authenticate the mobile phone number registered in iTax upon logging into the system,”
READ: KRA iTax Mobile Number Verification, A Simple Guide for Taxpayers
Kenya’s government is working hard to conform to the economic policy reforms spelt out by the International Monetary Fund (IMF). These efforts are part of the package of economic reforms agreed to in Kenya’s $3.6bn loan program. The initiative aims to rope into the tax net millions of informal sector business utilizing mobile money accounts.
