NJIHIA: Technology can spur tax collection, boost development agenda

Woman counting money. PHOTO | FOTOSEARCH
Woman counting money. PHOTO | FOTOSEARCH  

Fresh from party manifestos this week, I am struggling to reconcile just how all the promises made will be funded, in light of the already heavy public debt burden that we are servicing in our quest for Vision 2030.

As we get excited by the possibilities, the expectation must be punctuated by calls from the Kenya Revenue Authority to individual and corporate citizens to meet their obligations.

The unfortunate truth is that a majority of Kenyans only pay for a single flavour of tax that is VAT, applicable to various non-exempt goods and services and therefore near impossible to avoid.

According to the Economic Survey 2017, the informal sector accounted for 83.1 per cent of employment to stand at 13.3 million persons against a total of 16 million, with micro, small and medium sized enterprises engaging 14.9 million.

It is estimated that there are between 1.5 to 1.7 million licensed MSMEs in the country and about 5.85 million unlicensed businesses.

The same evasion culture exists here, powered by an economy where cash is still king and therefore that little more difficult to track as it changes hands.

Here’s the thing: we will all gripe about poor service delivery and cite performance scorecards whose projections confirm what we have become accustomed to unmet goals and broken election run-up promises.

This leads to a vicious cycle of disappointment from which no regime would be able to break free unless we can cast the net wider and avoid placing the burden of development on the shoulders of “a few”.

Perhaps we need to start looking at “tax tech”, with a logical starting point being analysis of digital money movement mapped on daily transaction data from local banks layered with additional metadata from third party sources as we move steadily towards a cash-lite economy. 

The thought may be controversial in some ways if privacy pundits are to have a say.

However, it safely falls short of what the KRA in its quest to meet ambitious revenue targets wanted to do, which was to have unfettered access to taxpayers’ bank accounts.

It is possible to have this ledger populated and mined in automated fashion to deliver the value that powers development. Life, death and taxes should be the portion of every citizen in equal measure.