Cyprian Is Nyakundi has once again drawn attention to the government’s troubling financial performance by highlighting a fresh revision of tax collection targets. According to new figures from the National Treasury, Kenya has slashed its revenue projection by Ksh 40 billion, adjusting the target from the previously stated Ksh 2.58 trillion to Ksh 2.54 trillion.
This adjustment is not the first, but the third in a row, painting a worrying picture of consistent failure by the Kenya Revenue Authority (KRA) to meet its targets.
Over the last nine months, the KRA has continued to underperform, struggling to match expectations despite the increasing tax burden placed on citizens.
The latest revision is linked to a shortfall of Ksh 93.2 billion in tax revenue collected between July and December 2024. These details were laid bare in the Treasury’s own submission to the National Assembly’s Budget and Appropriations Committee.
The numbers show that by the end of February 2025, the KRA had only managed to raise Ksh 1.624 trillion. With only four months left in the financial year, the taxman is now under pressure to collect a further Ksh 917.8 billion by the end of June.
This target appears too ambitious considering the current state of the economy and the trends observed in recent months.
The Treasury blames the lower revenue performance on weak economic growth experienced in the first half of the financial year. Domestic challenges such as the high cost of living, low consumer spending, and unstable exchange rates, combined with external shocks like reduced international trade and global inflation, have all contributed to this poor outlook.
Despite promises of improved economic conditions, the data clearly shows that the government is struggling to stabilise its finances and implement a reliable tax collection strategy.
Interestingly, the same revised revenue figures have been used by the Treasury to justify a proposal to allocate Ksh 405 billion to counties in the next financial year, 2025/26. This move may be seen as an effort to distract from the worsening national revenue crisis by redirecting attention to county-level development funding.
However, concerns remain about whether such allocations are sustainable if KRA continues to miss its targets. These developments raise questions about the government’s planning and its ability to fund critical services.
The continued downward revisions show a deepening problem in revenue collection and budgeting. As Nyakundi pointed out, this is more than just poor performance, it’s a clear sign that the country’s financial stability is under serious threat. Without urgent reforms, Kenyans may soon bear the burden of these failures through more taxes, reduced services, or higher debt.
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