EAC revenue authorities to set up system to curb tax evasion

East Africa Revenue Investigation and Enforcement Agency is seeking financial support from World Bank to fund the setting up of an integrated single customs system, in a bid to curb tax evasion.

The electronic tracking platform will enable seamless visibility of transit cargo which will enhance greater compliance.

Kenya Revenue Authority (KRA) acting commissioner investigations and enforcement David Yego said the system will help in collection of taxes and duties at the point of entry into the East African community.

“We want to move with speed to be able to eliminate tax crimes. We want to strengthen our own skills we want to know what we have and what we don’t have in strengthening our skills .The World Bank is helping the authorities on capacity building in terms of skill development. They are part of our donors,” Mr Yego said.

Having lost $50 billion 2015 through tax avoidance schemes, streamlined customs processes will help encourage cross-border and international trade

“There are many challenges mis-declaration and the biggest being concealment. One declaring the goods are A and the good are B for the purposes of lowering taxes .Someone declares goods are destined to Uganda, Rwanda, Burundi or Tanzania and along the way decides to divert them to Kenya to avoid paying taxes” Mr Yego said.

The system will allow electronic submission, processing and delivery of clearance documents for import, export and transit of goods at the borders, airports and various ports.

“We have frame work of information sharing .the only charge we have is getting the information at the right time. There is a problem with the communication systems and at times we get the information late and reply late. Chasing about with the fraudster becomes a bit tricky. What we want is to overcome the problem of communication. It doesn’t matter where the information comes from,” he added.

KRA is working closely with the National Intelligence Service to strengthen intelligence on how to deal with tax evaders.

Strengthening of the collaboration and deepening of the relationship in East African Community will be effective in detecting and deterring the fraudsters.

Taxes have recovered that have been under declared in the East African Community.

In 2015 goods worth $148 million were retrieved from 30 foreign multinationals.