Kiambu, KRA partner to hunt rate defaulters

Kenya Revenue Authority (KRA) Commissioner General John Njiraini speaks during a media briefing at his Times Towers offices in Nairobi on April 19, 2016. The taxman has partnered with Kiambu County government to hunt for Sh2 billion in uncollected rates from defaulters. PHOTO | SALATON NJAU | NATION MEDIA GROUP

What you need to know:

  • Kiambu County and taxman have partnered to recover over Sh2 billion in uncollected rates.
  • Financial analyst and economist Ndindi Nyoro says the move will yield positive results because defaulters will want to avoid a fight with KRA.

Kenya Revenue Authority (KRA) has finalised a working arrangement with the Kiambu County government in which the tax collector will go after defaulters who owe the county over Sh2billion in uncollected rates.

“Despite giving notices to the defaulters to pay through newspapers, we have been frustrated in getting the dues. We believe that the partnership with KRA will not only assist us recover the money from landlords but also establish whether or not they pay their taxes,” says Hassan Mwangi, the Kiambu finance chief officer.

According to the county government, working with KRA will increase tax compliant and reduce the probability of default.

“We are also considering of releasing defaulter details to credit rating agencies,” Mr Mwangi said.

In the deal, credit rating agencies will black list defaulters, mostly developers, from accessing credit in the future.

Financial analyst and economist Ndindi Nyoro says the move will yield positive results because defaulters will want to avoid a fight with KRA and save themselves from poor credit rating.

(Editing by Joel Muinde)