KRA needs to improve its relations with taxpayers
Wednesday May 05 2021
By BUSINESS DAILY
- From campaigns in the media to e-mailed notifications to individual taxpayers, the taxman seems spirited in achieving its goals.
- However, whilst it is the civic duty of citizens to file their returns the KRA should avoid acts that instil fear in taxpayers.
The Kenya Revenue Authority (KRA) is once again in the limelight as the annual filing of tax returns by June falls due. With barely a month to the deadline of this exercise, the taxman has stepped up its push to ensure compliance by as many tax payers as possible.
From campaigns in the media to e-mailed notifications to individual taxpayers, the taxman seems spirited in achieving its goals.
However, whilst it is the civic duty of citizens to file their returns the KRA should avoid acts that instil fear in taxpayers.
For example, the KRA on Monday issued a public notice announcing its intention to deregister and cancel personal identification numbers (PINs).
The tone of the messaging was rather off the mark, sounding more of a threat than a standard request for compliance by taxpayers. The notice also failed to detail the circumstances under which PINs would be cancelled or the procedure of doing so.
Perhaps hurt by the faux pas, the taxman yesterday issued a better toned-down notice with details on the compliance requirements and what it would entail to deregister and cancel PINs.
Such glaring mistakes should be avoided if the KRA is to achieve its objective of maximising compliance among taxpayers. For a long time, tax regimes have been shrouded in fear and mystery which has had consequences on compliance levels.
The KRA stands reminded that managing and improving tax compliance requires good relationship with taxpayers.
This calls for more focus on understanding the factors that shape taxpayers’ compliance behaviour so that it is able to deal with the underlying non-compliant behaviour rather than focusing on treating the symptoms. Worldwide, the public opinion held by taxpayers has profound consequences on compliance and the KRA should strive to be the on the right side of things.
The way a revenue authority is viewed within the community has a direct impact not only on attitudes towards compliance but also on the ability to successfully administer the taxation system.
The KRA should therefore avoid intimidation and refine its relations with taxpayers to guarantee better compliance.
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