Kenya emphasizes VAT compliance as a necessity for a fair business environment, not a burden, to ensure stable economic growth and funding for public services. Despite initiatives like the VAT auto-population system and eTIMS, significant non-compliance persists, evidenced by a 39.8 percent underperformance in VAT revenue during the 2021/22 financial year.

• VAT revenue for the 2021/22 financial year underperformed by 39.8 percent.
• The Kenya Revenue Authority (KRA) is introducing a Business Tax Compliance Certificate to ensure full tax regulation adherence, including eTIMS onboarding.
• Only about 508,000 businesses have complied with eTIMS, a legal requirement to electronically capture transactional data in real time.