KRA’s Times Towers

On the first week of August popular political scientist Mutahi Ngunyi shocked Kenyans when he wrote a letter to the government seeing to return Sh11.9million irregularly paid to his firm The Consulting House.

The renowned analyst wrote to Cabinet Secretary for Public Service, Gender and Youth Cicily Kariuki to be told how he can refund the money illegally wired to his account following engagement with National Youth Service.

The letter wanted clarity from the government to explain how the anomaly passed the government online tender and payment portal Integrated Financial Management Information System (IFMIS).

The system was launched by the Jubilee government, under their digital election campaign to give all Kenyans an equal playing field in getting government tenders and streamline revenue and tax collection.

IFMIS is an automated system that is used for public financial management. It interlinks planning, budgeting, expenditure management and control, accounting, audit and reporting with a view of ending corruption.

Sadly this has failed to go through, with governors and civil servants entrenched in corruption cartels working overtime to ensure it flops.

To see the extend of the flop, the current budget will not handle Sh451 billion through IFMIS even though ministries, departments and agencies will receive the amount away from rigorous scrutiny risking being misused.

In the financial year 2015-2016, the Treasury estimates that ministries will receive funds totaling Sh388 billion for development expenditure and Sh63 billion for recurrent expenditure.

Controller of Budget Agnes Odhiambo was quoted by local dailies to say if IFMIS does not adequately capture the amount then “financial reports generated from the system are incomplete.”

But this will soon be over as Kenya Revenue Authority plans to directly link its electronic tax filing system iTax with the IFMIS to maximize collection of withholding VAT and income tax from government’s development budget standing.

Ms. Catherine Mbogo, the head of tax at business and consultancy firm Ernst & Young is quoted in local dailies saying the move will not only cut cost for KRA but increase tax targets.

These will increase tax compliance levels to more than 75 per cent.