Facing a cash crunch, Kenya’s president accuses tax agency of graft

Kenya's President William Ruto speaks at a press conference at the State House in Nairobi, Kenya May 5, 2023. Picture: Monicah Mwangi REUTERS

Kenya's President William Ruto has accused the tax collection agency's staff of cutting government revenue by engaging in corruption. REUTERS/Monicah Mwangi/File Photo

Published May 27, 2023

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NAIROBI - Kenya's President William Ruto has accused the tax collection agency's staff of cutting government revenue by engaging in corruption, colluding with tax evaders and taking bribes.

Ruto, who was elected last August on a platform of helping the poor, has had a rough ride in the first months of his term due to growing government debt repayments, revenue collection shortfalls and persistently high prices of basic commodities.

Public service employees have complained of salary delays in recent months while local authorities have threatened to shut down their operations to protest against delayed cash disbursements from the national government.

"Collusion, wanton bribe-taking and general corruption continue to pervade operations of KRA (Kenya Revenue Authority)," Ruto told KRA's management and board members at an event beamed live on his social media pages.

The government's efforts to boost tax collection were being hampered by unscrupulous staff at the revenue authority who spent their time helping corrupt taxpayers to evade paying, he said.

The Kenya Revenue Authority declined to comment.

Kenyan authorities have been fighting corruption and the tax collection agency has come under scrutiny. In May 2019, 75 revenue staff were arrested on suspicion of abetting tax evasion and bribery.

Ruto also accused KRA staff of resisting and sabotaging attempts to digitise revenue collection in the past, to prevent the government from sealing loopholes.

"I have to be candid because I have a job to do," the president said.

The Kenya Revenue Authority has not issued its latest tax collection figures but local media outlets said it collected 1.57 trillion shillings ($11.50 billion) in the 10 months to the end of April, meaning it has just two months to meet the government's target of 2.1 trillion by the end of June.

In terms of tax collected as a proportion of annual economic output, Kenya has been under performing other nations like South Africa, Ruto said.

To shore up revenue, his administration has proposed a raft of tax increases in spending proposals that will be presented to parliament next month, angering citizens and the opposition.

"The (finance) bill prepared by the Kenya Kwanza regime is a punishment that Kenyans cannot and should not entertain," the opposition Azimio coalition said this month, referring to Ruto's Kenya Kwanza political coalition.

Anti-graft watchdog recalls award

Meanwhile, anti-graft watchdog Transparency International has withdrawn an award it gave Kenya's outgoing chief prosecutor, it said on Friday, accusing him of dropping high profile corruption cases.

The Kenyan chapter of the global watchdog had awarded Noordin Haji its Integrity Award in 2019, saying he had led his office in prosecuting dozens of corruption cases, which was seen as an historic achievement in a country beset by graft.

Anti-graft watchdog Transparency International has withdrawn an award it gave Kenya's outgoing chief prosecutor Noordin Haji. REUTERS/Stringer/File Photo

Haji, who has been nominated by Ruto to become head of the spy agency, has dropped charges against several high-profile corruption suspects after Ruto took over last September.

Transparency International (TI) Kenya said it had received public petitions against the decision to drop the cases, including those against Deputy President Rigathi Gachagua and Aisha Jumwa, who is a cabinet minister.

"These petitions have raised serious allegations regarding the withdrawal of high profile corruption cases, including those for which you were previously recognised, resulting in the loss of public funds," TI Kenya Executive Director Sheila Masinde said in a letter to Haji released on Friday.

Both Gachagua and Jumwa denied any wrongdoing when they were on trial.

The group also raised concerns about six other corruption cases that have been withdrawn by prosecutors, who cited lack of sufficient evidence for the decisions.

Haji, whose nomination to the helm of the country's intelligence service is awaiting parliamentary vetting, did not immediately respond to a request for comment.

The Office of the Director of Public Prosecutions, which he heads, said they had received the letter from TI and acknowledged Masinde's decision.

"In adherence to the principles of fair hearing and due process, we eagerly anticipate an invitation from the board of TI, providing us with the opportunity to present our perspective," it said in response to a request for comment.

"During this interim period, we have discontinued the utilisation of the award and will promptly return it upon the board's determination."

Ruto and his top officials have accused his predecessor, Uhuru Kenyatta, of using the war on corruption to target his political opponents.

($1 = 136.5000 Kenyan shillings)

REUTERS