Taxes –All business including those with less turn over will still be required to comply with the digital revenue policy.
In a significant policy reversal, the Kenya Revenue Authority (KRA) has rescinded its previous decision to exempt businesses with an annual turnover of Ksh 5 million and below from producing invoices through the electronic Tax Invoice Management System (eTIMS).
The latest gazettement of Kenya Subsidiary Legislation 2024 eliminates these exemptions, compelling all businesses, regardless of size, to comply with the digital invoicing system.
The original exemption was announced in the Tax Procedures (Electronic Tax Invoice) Regulations, 2023, identifying small-scale suppliers as among those not required to adopt the new system.
This exemption was further affirmed in a draft released in January 2024 by the KRA which explicitly stated that supplies by resident persons generating less than Ksh5 million annually would be excluded from the eTIMS requirement.
However, the deadline for mandatory onboarding, which lapsed last month, saw a lacklustre uptake, particularly among informal sector businesses, who were the primary targets of this regulation.
According to KRA data released last month, the tax man registered only 186,530 taxpayers on the eTIMS platform — a significant shortfall from its target of 915,000, marking an 80 per cent deficit.
