This archive report was first published on 8 July 2020.
As of July 2020, the Kenya Revenue Authority (KRA) had paid back Sh25 billion in value-added tax (VAT) refunds to firms struggling with funds due to the Coronavirus pandemic.
According to KRA, as of June 25, 2020, the total value of VAT refund claims stood at Sh62.3 billion, comprising a stock of Sh24.3 billion from the 2018/19 financial year and additional claims worth Sh38 billion in the 2019/2020 financial year.
Of the Sh62.3 billion in claims, KRA had processed Sh36.1 billion in the 2019/2020 financial year, with Sh23.6 billion paid out and an additional Sh1.8 billion earmarked for payment by the end of June 2020.
Speaking on the matter, KRA Commissioner for Domestic Taxes Elizabeth Meyo noted that the amounts paid out so far were a new record, surpassing the previous highest payment of Sh14.1 billion in the 2018-19 financial year.
The taxman began paying out VAT refunds following a presidential directive and the release of funds by the National Treasury.
“We have begun paying various businesses entities VAT refunds from special funds allocated by the government and released to KRA, and expect to finalize the payments process in one week,” said Commissioner Meyo in a statement in May.
The refunds are expected to offer financial relief to businesses worst hit by the Covid-19 pandemic, particularly in the horticulture, transport, and hospitality sectors.
Only businesses with verified refund claims in line with procedures will receive payments, Meyo emphasized.
