Out of Sh62.3 billion claimed by firms, the Kenya Revenue Authority (KRA) had paid back Sh25 billion in value added tax (VAT) refunds as at July 2020 in order to boost firms struggling with funds due to the Coronavirus Pandemic.
“As at end of the financial year 2018/19, KRA had stock of Value Added Tax (VAT) refund claims worth Sh24.3 billion and has received additional claims worth Sh38 billion in the Financial Year 2019/2020, bringing the total value of claims to Sh62.3 billion as at June 25, 2020,” said KRA on Tuesday.
“In the 2019/2020 financial year, claims worth Sh36.1 billion have been processed, out of which Sh23.6 billion have been paid out and an additional Sh1.8 billion being earmarked for payment by end of June 2020. This will bring the total tax refund payment in the financial year 2019/2020 to Sh25 billion.”
KRA Commissioner for Domestic Taxes Elizabeth Meyo said the amounts paid out so far are a new record compared to the previous highest payment of Sh14.1 billion in the 2018-19 financial year.
The taxman begun paying out VAT refunds following a presidential directive and release of funds bythe National Treasury.
“We have begun paying various businesses entities VAT refunds from special funds allocated by the government and released to KRA and expect to finalize the payments process in one week”, said the Commissioner for Domestic Taxes Ms. Elizabeth Meyo in a statement in May.
The refunds are expected to offer financial relief to businesses worst hit by the Covid-19 pandemic especially the horticulture, transport, and hospitality sectors of the economy.
“Only those businesses entities that have had their refunds claims verified in line with procedures will receive payments,” said Ms. Meyo.
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