The Kenya Revenue Authority (KRA) has announced it will soon start paying out VAT refunds to businesses that have been hardest hit by the economy.
In a statement dated Saturday, May 30, KRA stated that it had received Ksh 10 billion following the release of funds by the National Treasury.
Commissioner for Domestic Taxes at KRA Elizabeth Meyo informed that the authority had already started paying out refunds to some business entities.
“We have begun paying various businesses entities VAT refunds from special funds allocated by the government and released to KRA and expect to finalise the payments process in one week”, she stated.
Some of the businesses that will benefit from this fund include; horticulture, transport and hospitality, which have been hit hard by the Covid-19 pandemic.
“Only those business entities that have had their refund claims verified in line with procedures will receive payments,” Meyo stated.
Before the first case of coronavirus was reported in the country, KRA had rejected Sh6.1 billion VAT refund claims for the 2019 financial year.
The tax refunds have been delayed over the past few months, which Meyo attributed to the lodging of inaccurate claims by taxpayers (wrong declarations), leading to rejection of claims.
This means, lack of proper documentation has forced the taxman to heighten scrutiny on claims to evade wrong payments and possible fraud.
In April, Treasury CS Ukur Yatani stated that the disbursement of Sh13 billion owed in pending bills and a further Sh10 billion tax refunds would commence on April 24.
Approximately, the government owes Ksh 27 billion in VAT refunds on exports to manufacturers and exporters.
