Kenya Revenue Authority Collects KSh 86.5b from Tax Disputes with Firms, Individuals
- The Kenya Revenue Authority (KRA) has been enhancing tax compliance through different alternative mechanisms
- KRA revealed that in the financial year ended June 2025, it collected 43.08% higher revenue from tax disputes compared to the 2023/2024 financial year
- The taxman disclosed the number of successful cases it resolved in and out of court during the review period
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TUKO.co.ke journalist Japhet Ruto has over eight years of experience in financial, business, and technology reporting and offers deep insights into Kenyan and global economic trends.
In the last fiscal year, which concluded in June 2025, the Kenya Revenue Authority (KRA) recovered KSh 86.52 billion through the settlement of tax disputes with individuals and businesses.
Source: Twitter
According to commissioner for legal services Paul Matuku, the amount of revenue collected from litigation and alternative dispute resolution procedures is 43.08% more than the KSh 60.47 billion in the 2023/2024 financial year.
Why was KRA successful?
The taxman attributed the increase mostly to the rising acceptance of out-of-court settlements with taxpayers.
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"We’re embracing Alternative Dispute Resolution (ADR), which is a flexible and faster way of solving tax issues. Instead of going to court, many taxpayers are now sitting down with us to resolve matters amicably.
Through ADR, we have unlocked KSh 18.9 billion. For disputes where court was necessary, we still ensured accountability. We collected KSh 67.6 billion through 2,389 successful court cases. But while the courts deliver results, they do take time, hence why we’re encouraging more use of ADR to reduce delays and costs," KRA explained in a statement on Wednesday, July 30.
Kenya introduced the tax dispute settlement mechanism in April 2015, following the implementation of the Tax Appeals Tribunal Act, 2013, as part of corporate reforms intended to improve the nation's investment climate.
Previously, the procedure was regulated by a number of tax laws, and the KRA provided funding for the resulting tribunals.
What's the process for disputing tax bills?
Taxpayers who contest their tax bills must notify the appropriate commissioner (domestic or customs) and file an appeal with the tribunal within 30 days after receiving a message from the KRA.
Source: Twitter
The tribunal must hear the matter and render a decision within three months, and they must pay a non-refundable cost of KSh 20,000.
Business leaders have previously criticised the KRA for having an unpredictable tax system that imposes excessive taxes on a small number of individuals and businesses in the formal sector.
"We provide a payment plan when a taxpayer acknowledges that they owe money but is unable to pay in full. However, as a gesture of goodwill, we advise our taxpayers to make every effort to maintain the payment plan; this is because when you default, there's a tendency to blame everyone," KRA's commissioner for large and medium taxpayers Rispah Simiyu stated.
How much did KRA collect in 2024/25 FY?
Earlier, TUKO.co.ke reported that KRA surpassed its revenue target for the 2024/2025 financial year.
The taxman disclosed that it collected KSh 2.571 trillion during the reviewed period against a target of KSh 2.555 trillion.
KRA reported that this reflected a performance rate of 100.6% compared to the KSh 2.407 trillion collected in the 2023/2024 fiscal year.
Proofreading by Asher Omondi, copy editor at TUKO.co.ke.
Source: TUKO.co.ke
