Taxman targets land purchase and NSE data to rein in cheats

The Kenya Revenue Authority is planning to tap information on taxpayers’ land purchases and investments at the stock market to catch tax cheats.

KRA says the strategy will involve gathering third-party data to track individuals’ income for purposes of verifying their tax payments.

KRA commissioner-general John Njiraini on Thursday said the tax agency will build taxpayers’ profiles especially for audit appraisals and tax demands.

“We are receiving huge volumes of data including from third party sources like investment in property and shares and even in future, banks. Talks with mobile money companies are still ongoing, although not concluded to harness such data as well, so we will continue to invest in technology to manage all these data,” said Mr Njiraini after presiding over the commemoration of the International Customs Day.

Data, which was central in this year’s celebrations themed, ‘Data Analysis for Effective Border Management’ is said to the most useful resource in managing fast-changing revenue collection dynamics with increasing cross-border trade and e-commerce.

The KRA said using data will quicken most processes including decision making on audit targets and accuracy in forming basis for tax demands in cases of default.

A data centre construction is under way and is expected to be completed by April as the tax man moves to collate taxpayers’ information in a manner that will leave no room for tax evasion.

READ: KRA targets mobile money to smoke out tax cheats

Recently, KRA’s i-Tax system roped in the Integrated Finance Management and Information System (Ifmis) in order to receive real time data on individuals and companies receiving payments from both the national and county governments.

By plugging into the Nairobi Securities Exchange, and later, a possible leeway to accounts and mobile money records, the taxman will have outsmarted businesses and individuals left outside the tax bracket that needs expansion.

Mr Njiraini said importers will also have the platform to declare goods while still on transit to shorten the clearance of cargo at the ports of entry and help detect potential tax evasion before the goods are received.

“With good data and information technology then we can start doing what is called value benchmarking which will enable us to ... tame misdeclaration of values where our systems will simply reject the entries and subject the tax payer to probing.”