Real estate experts have cautioned investors to take 'careful consideration' of cultural, regulatory and tax matters in the region before sinking billions in the sector. PHOTO | SHUTTERSTOCK
Some 855 firms and 940 individuals have self-reported to the Kenya Revenue Authority (KRA), in a race to take advantage of the three-year tax amnesty, which hopes to unlock billions of shillings from tax cheats.
The taxman says it has, however, rejected applications from at least 540 firms seeking waivers under the Voluntary Tax Disclosure Programme (VTDP).
Some applications were rejected because the income declared was earned outside the qualifying period of July 1, 2015, to June 30, 2020, while others failed to disclose some material facts.
Still, others were denied the relief because they were under audit or investigation or were a party to ongoing litigation in relation to the tax liability.
The three-year programme rolled out in January 2021, though yet to see big defaulters walk through its doors, has so far recovered Sh8.54 billion against an estimate more than Sh200 billion still undeclared.
The KRA should take the lessons from this exercise to enrich its implementation of alternative dispute resolution (ADR) mechanisms. Tax agencies globally are embracing ADR mechanisms due to their ability to swiftly resolve tax disputes.
ADR is largely seen as the first layer of resolving disputes arising from tax audits before they are escalated to the Tax Appeals Tribunal and on to the courts.
Already the KRA is scoring early wins from embracing this dispute resolution mechanism. The taxman says it resolved 319 cases referred to arbitration in the first half of the current financial year ending June, which earned it Sh9.4 billion.
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Note: The results are not exact but very close to the actual.
