This archive report was first published on 24 August 2020.
Kenya's economy is still reeling from the effects of the COVID-19 pandemic, with tax receipts falling by Sh13 billion in July 2020.
According to revenue statistics published by Treasury Secretary Ukur Yatani, the Kenya Revenue Authority (KRA) collected Sh94.54 billion in taxes in July, a 12.02 percent decline from the Sh107.45 billion collected in the same period in 2019.
This decline is the lowest tax receipts since 2017 and comes despite a slight improvement in business activity in July, as reported by a closely-watched monthly survey.
KRA Commissioner-General Githii Mburu has expressed optimism that the current financial year's performance will be better, but analysts have warned that the COVID-19 uncertainty remains elevated.
‘Traditionally, the review month (July) has been a slow month in ordinary revenue mobilisation and as such, untangling the Covid-19 impact on the actual out turn would be a daunting affair,’ analysts at Genghis Capital said in a note.
July marked the first month since December 2019 that companies reported significant increment in sales, but the economy remains depressed, with some sectors still stalled.
‘The economy on aggregate is still depressed as some aspects are still pushing along, almost like a car in third gear and others like tourism and hospitality have taken a hit and are still stalled,’ said Robert Nyamu, head of financial services and risk advisory at EY East Africa.
