KRA should look at developing direct market interventions that will empower users to get paid faster.
Nothing in this world can be said to be certain, except death and taxes. I moderated a panel at the 4th Annual Tax Summit that looked at technology as an enabler where in collaboration with others, explored new frontiers for revenue collection and administration.
It was welcome that the Kenya Revenue Authority (KRA) has an active strategy, innovation and risk department that engages with associations like the Kenya Association of Manufacturers and the Kenya Private Sector Alliance. However an invisible bottom exists that needs to be activated for balanced tax inclusivity.
The gig economy, e-commerce and adoption of cryptocurrencies now add to the complex, albeit slightly handled task of bringing more into the taxation fold. From the conversation, I distilled two must-do actions by the taxman vis-à-vis their mandate and ambitious targets in the medium to long term.
The first is to adopt an open innovation mindset, with the key agenda of opening up iTax and complementing systems to third parties via robust and secure application programming interfaces.
This will empower independent software houses to officially embed tax compliance across all manner of consumer-facing applications, creating seamless experiences primary of which are attribution, submission and claims; which can then be only a single click away.
The second is to become an ally to the individuals hustling and active in the gig economy plus mSME operatives. The move here is simple; address a key pain point. Ranking high for those in this pool is the common situation of being invoice-rich but cash-poor.
KRA should look at developing direct market interventions that will empower users to get paid faster. I imagine the authority as a payments mediator with deep integrations to all banks and mobile money platforms, as an unbiased third-party on commercial transactions both big and small. Smart contracts that would ensure prompt payment will more than likely endear the authority to many. How about having its own SaaS accounting platform offered for free, activated and mapped to every new tax account automatically with ready payment rails similar to what banks and others in the fintech space are working to provide?
By changing tack, providing additional value and reimagining the relationship with the addressable market beyond that of collector, the KRA can make short work of its targets while empowering the government to perhaps ease the net individual or business tax burden.
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Note: The results are not exact but very close to the actual.
