Prosecute tax dodgers, orders Kibaki

President Mwai Kibaki on Monday authorised the agencies to prosecute persons and businesses participating in tax crimes.

President Kibaki also directed government agencies to enforce measures that prevent tax related crimes.

"I remind Kenyans that tax evasion is an economic crime punishable under the Economic Crimes Act," he said during the Taxpayers' Day celebrations in Nairobi.

He said the government will continue to deepen tax reforms and modernization and also improve tax collection in order to raise resources for funding state operations without excessive borrowing.

"We also aim to make our tax system simpler, easier to comply with and efficient in promoting domestic investment, Foreign Direct Investment and employment creation. I am happy that the reforms we have implemented so far have resulted in increased tax collections," he said.

Kibaki said the government has also managed to fund about 95 per cent of Kenya's total annual budget on its own as a result of improved tax collections.

"The government will continue to ensure that the revenue raised is utilised efficiently and transparently through the elimination of wastage and corruption. We will also continue to ensure that resources are allocated in accordance with priority development targets," he said.

Kibaki said the increase in tax revenue had enabled the government to finance key projects in education, health, transport, water and irrigation, energy, communication and agriculture.

“On these key priority areas alone, my government has spent about 3 trillion shillings since 2003,” he said.

Kibaki said that over the same period, the government disbursed more than Sh90 billion to Constituencies, through the Constituency Development Fund (CDF), to facilitate service provision based on unique and specific local needs.

During the occasion, Kibaki presented awards to 40 of the country’s leading taxpayers drawn both from the public and private sectors and also launched KRA’a i-tax Portal service that will enable tax payers to access relevant information.

During the ceremony, Safaricom topped the list of 2011/2012 taxpayers, while EABL took the second position and Teachers Service Commission (TSC) took third position.

President commended compliant taxpayers for enabling the government to generate the requisite finances to meet its obligations.

“In general, the quality of life for the average person has improved. We have done all these with finances that were generated largely internally through our tax system,” he said.

“If more Kenyans pay taxes, I am certain we will realize our Vision 2030 objectives of transforming Kenya into a globally competitive middle income economy with high a quality of life for all citizens,” he added.

Kenya Revenue Authority (KRA) Commissioner General John Njiraini said new ways of collecting revenues including use of mobile money transfer will be relied on.