The Kenya Revenue Authority (KRA) Monday said that it has so far cleared 74 businesses, three months after it deactivated their VAT accounts in the fight against tax evasion.
The taxman deactivated the accounts of 66,269 firms on June 10, on grounds of perennially failing to file their monthly returns or persistently filling nil returns.
The deactivation has locked the firms out of business since they cannot charge VAT on their supplies and any input VAT claimed from supplies they may make is deemed invalid.
More than 66, 000 businesses remain locked out of operations after they failed to have their Value Added Tax (VAT) accounts reactivated by the Kenya Revenue Authority.
The Kenya Revenue Authority (KRA) Monday said that it has so far cleared 74 businesses, three months after it deactivated their VAT accounts in the fight against tax evasion.
The taxman deactivated the accounts of 66,269 firms on June 10, on grounds of perennially failing to file their monthly returns or persistently filling nil returns.
The deactivation has locked the firms out of business since they cannot charge VAT on their supplies and any input VAT claimed from supplies they may make is deemed invalid.
“Out of the entities whose VAT obligations were cancelled, 74 have been cleared for VAT reactivation,” KRA told the Business Daily.
“These are being handled on a case-by-case basis. Those who have come forward are being facilitated to provide all the necessary evidence required for VAT reactivation.”
KRA did not give numbers of firms whose applications for clearance have been rejected, but the low numbers of those cleared highlights concerns that the taxman has raised against businesses in the past.
The taxman has previously flagged firms for filing fictitious VAT invoices to evade paying taxes and faking invoices to inflate purchases of inputs in a bid to cut their VAT obligations.
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