The Kenya Revenue Authority (KRA) has increased tax collections by 3.6% to Sh1.91 trillion in the 10 months to April 2024, defying tough economic conditions that have strained businesses and households.
This amount represents 95% of the Sh2.006 trillion target set for the national government during the period, highlighting the impact of economic headwinds that slowed private sector activity, trade, and consumption.
In addition to taxes, KRA collected Sh205.52 billion in agency revenues, surpassing the prorated target of Sh183.8 billion by 11.8%.
This brings the total revenue collected during the 10-month period to Sh2.11 trillion.
KRA noted that the economy showed signs of sluggishness, with the Purchasing Managers Index (PMI) averaging 49.8 between July 2024 and April 2025, indicating contraction in private sector activity.
This was reflected in a 1.6% decline in import values — a key indicator of domestic demand for inputs and consumer goods.
To meet its full-year revenue target of Sh2.67 trillion by June 30, 2025, the tax authority must collect an additional Sh556 billion in the final two months of the fiscal year, having already achieved 79% of its goal.
Domestic taxes — which include income tax, value-added tax (VAT), and excise duty — rose by 4.7% to Sh1.39 trillion compared to the same period last year. Customs revenue also saw growth, increasing by 9.1% to Sh722.74 billion, despite the decline in imports.
The revenue gains came amid a challenging domestic business environment. Private sector credit growth remained subdued, with only a 0.2% increase in March 2025 following a 1.3% contraction in February.
Additionally, the proportion of non-performing loans (NPLs) rose to 17.2% in February from 16.4% in December 2024, with sectors such as real estate, personal and household, trade, construction, and manufacturing being most affected.
Export earnings also dipped by 3.6% during the period, driven by significant declines in key sectors. Tea exports fell by 18.6%, while horticultural exports declined by 6.2%.
