This archive report was first published on 1 December 2019.
On December 1, 2019, a dispute emerged between the Retail Trade Association of Kenya and the Kenya Revenue Authority (KRA) over a new tax system.
The KRA had introduced the Value Added Auto Assessments (VAA) system in October 2018 to curb tax evasion by flagging inconsistencies between purchase and sales invoices.
However, the Retailers Association of Kenya claims that the system is impractical, particularly for small businesses, as it does not account for the way they file their returns.
The association argues that their VAT records do not match the KRA's system because they send their records in bulk after selling to individuals who later make separate claims.
‘If you are a small business selling textbooks and an individual comes and buys across the counter and they do not tell you they will claim or not and have not given or taken their PIN, when you file you give bulk VAT for the till they will obviously not match,' said Retrak CEO Wambui Mbarire.
The association has called for a crisis meeting with the KRA to iron out the issues raised with the implementation of the system.
