Kenya Revenue Authority (KRA) rode on strict border controls and new technology at the port of Mombasa to collect a record custom in the last six months.
The use of technology and the proactivity of customs officers who have been vigilant to ensure contrabands are contained at the port of Mombasa has made the port less attractive for smuggling and international crimes, according to Deputy Commissioner and Southern Regional Coordinator, Mr. Joseph Tonui.
Tonui said this when he addressed industry stakeholders and the media during this year’s International Customs Day celebrated yesterday, themed ” Customs bolstering recovery, renewal and resilience for sustainable supply chain.
Due to the stringent multi agency interventions at the port of Mombasa, the number of concealed and misdeclared goods has not been recorded since August 2019, unlike in the previous years when such interceptions were made frequently.
“This is in line with international efforts to combat transnational organized crime. The frequent concealment of high-end vehicles declared as household goods or other items on transit have not been reported in the recent past,” Tonui said.
A number of high end vehicles stolen from the UK, which had been declared to be on transit to Uganda were frequently intercepted in the past. Today, all the imported and exported containers through Mombasa port are subjected to scanning after KRA acquired state of the art scanners.
“This facilitates trade and enhances border security as it saves time unlike in the past when officers had to undertake physical verification for many containers delaying movement of the cargo,” Tonui said.
The Regional Electronic Cargo Tracking System (RECTS) has played a key role to contain diversion of the transit goods in the local market.
These new measures saw customs officers at the port of Mombasa and Southern region collect Sh 200.95 billion surpassing a target of Sh 183.578 billion in the half financial year ending in December 2020.
“I wish to note that the department could not have collected this amount of money without the implementation of stringent border control measures since revenue collection at borders is a by-product of law enforcement,” Tonui said.
In December 2020, the Customs & Border Control (C&BC) Department recorded the highest ever monthly revenue collection in KRA’s history by collecting Kshs 60.777 billion reflecting a growth of 40.9% and registering a revenue surplus of Kshs 12.191 billion.
“This resulted in a cumulative surplus for Customs revenue of Kshs 3.788 billion at the end of December 2020 compared to a deficit of Kshs 8.402 billion as at the end of November 2020,” Mr Githii Mburu, Commissioner General of KRA said in a recent statement.
Average daily dry revenue progressively increased to Kshs 1.744 million in December 2020, the highest ever daily average collection for Customs Revenue. Exemptions and remissions in Customs declined by 39.3%, positively impacting the revenue base by Ksh 3.344 billion which is consistent with efforts by Government to address the growth of remissions and exemptions which have undermined revenue mobilisation over the years.
Notwithstanding the challenging economic environment that persisted to the tail end of the year, KRA posted an improved revenue general performance rate of 101.3% for December 2020. This was the first positive and above target collection rate since the outbreak of Covid-19 pandemic.
The improved performance is attributed to the economic recovery following the relaxation of the stringent Covid-19 containment measures and enhanced compliance efforts by KRA in the month of December.
The KRA collected Ksh. 166 billion against a target of Ksh. 164 billion representing 3.5% growth over the same period last year.
The Domestic Taxes Department also registered the highest collection rate of 91.1% since the start of the covid-19 pandemic. During the month under review, Pay As You Earn (PAYE) taxes recorded the best performance at 99.8% while Withholding Tax surpassed the target by Kshs 725 million reflecting positive economic recovery prospects.
Corporation Taxes recorded a performance rate of 93.5% against the target. The performance was negatively affected by a decline in instalment remittance from banks by 25.3% (from Ksh 13.140 billion in December 2019 down to Ksh 9.810 billion in December 2020).
The Value Added Tax (VAT) domestic remittances declined by 19.9% as purchases accelerated at a faster rate (8.9% growth) than sales (1.4% growth), thereby diminishing the VAT forecast for the month.
“This decline is expected to reverse as businesses convert the stock to sales and further from the reversal of the rate to 16% effective 1st January 2021,” Mburu said.
