KRA Begins Paying Sh10 Billion in VAT Refund to Businesses Hit by Covid-19 Pandemic

The Kenya Revenue Authority (KRA) has begun processing value-added tax (VAT) refunds to business entities that have been adversely affected by the Covid-19 pandemic.

KRA said the refund, totaling Sh10 billion, is in line with President Kenyatta’s directive in April to enable the businesses to regain financial stability. 

“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  KRA commissioner for domestic taxes Elizabeth Meyo in a statement.

She added: “Only those business entities that have had their refunds claims verified in line with procedures will receive payments.”

A majority of the businesses that will benefit from the refund are in the hospitality, transport, agricultural and horticultural sectors.

KRA presently owes Kenyan exporters and manufacturers Sh27 billion in VAT refunds. The taxman rejected Sh6.1 million VAT refund claims for the year ending 2019 after comprehensive scrutiny of all applications presented.

Taxpayers can lodge their VAT refund claims via KRA online tax platform, Itax within a year from when the tax became due and payable. Taxpayers are able to track the status of their refunds through the platform.