KRA announces reforms to enhance revenue collection

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The Kenya Revenue Authority (KRA) has announced a variety of reform measures geared at enhancing national security and efficiency in Customs management.
Some of the far reaching reform measures, will involve the stringent vetting of all Container Freight Station (CFS) operators, to ensure they meet national security and related requirements. Clearing and Forwarding agents, will also be expected to adhere to a soon to be formulated professional code, guiding their training and certification.
The reforms announced over the weekend, by KRA, Commissioner General, Mr. John Njiraini, when he addressed members of the Kenya International Freight and Warehousing Association (KIFWA), are part of the Authority’s organizational transformation strategies.
To spearhead the envisaged reforms, KRA, he disclosed is set soon announce the appointment of the Authority’s first Head of Enforcement & Border Control within the Customs & Border Control Department, this week. The Head of Enforcement & Border Control, designate, Njiraini said, has extensive security sector experience.
The Customs reforms message, comes hot on the heels of the recent destruction of commodities imported into the country in contravention of Customs regulations. Already, KRA has issued a stern warning to persons perpetrating fraud in Customs processes and those that collaborate with them in the commission of such crimes. The Authority, Njiraini disclosed, has heightened surveillance and will not hesitate to arrest and prosecute those involved in tax evasion and economic crimes.
Further, as part of the reform agenda, Njiraini, disclosed to the members of the umbrella clearing, Forwarding and warehousing companies in Kenya, that the registration of new Container Freight Station (CFS) operators and that of new clearing and Forwarding agents has been suspended till further notice.
The suspension, Njiraini said, is geared at facilitating key reforms touching on the trade logistics supply chain sector, with a view to weeding out unscrupulous CFS operators and clearing agents.
“it has been resolved that CFS operations be re-visited with a view to weeding out malpractices including the abetting of fraudulent trade practices, Njiraini said, adding that, “a re-vetting process has commenced that involves a cross section of Government agencies, with the aim of determining the suitability of the CFSs in existence. The process, which is supported by new regulations gazetted by KRA in November 2015, shall assess a broad spectrum of issues including the probity of Proprietors and Key Management.”
Underlining the seriousness attached to the ongoing vetting process, Njiraini pointed it out that CFSs that fail to meet the prescribed requirements within the time frame provided shall be struck off the register and become ineligible to receive un-Customed cargo.

Plans to professionalize the Clearing and Forwarding sector, Njiraini said have already commenced as part of efforts to weed out rogue clearing and Forwarding agents.
“Because of the weak regulatory regime, the clearing and Forwarding business continues to attract persons of dubious character and for whom no effective disciplinary regime exists,” he said, adding that, “In order to correct this anomaly, process has already commenced to develop a legal framework to govern the training, certification, licensing and regulation of Clearing and Forwarding Agents.”
To facilitate efficiency in Customs management, the Authority has already moved to upgrade its Simba Customs Managment platform, which has also been integrated with National Electronic Single Window System, popularly known as the Kenya TradeNet.
KRA has also commenced the implementation of the Regional Electronic Cargo Tracking Platform agreed between Kenya, Uganda and Rwanda.
The new system, provides the regional revenue authorities with a seamless visibility for all transit cargo from Mombasa to Kigali and eventually Juba.
“This approach, will remove the opportunities presently exploited by crooks at the changeover of seals at border points by requiring affixation of only one seal to be disarmed on arrival at destination,” Njiraini noted.
Ongoing Customs management reforms, will also focus on the elimination of intermediaries, who currently handle tasks such as Shippers Manifest Submission. The Authority, he said, has already made significant progress and expects to commence pilot tests with key Shipping Lines by March 2016.
The role of intermediaries, has in the past been cited as a major avenue used for Customs declaration manipulation meant to support fraudulent importation.
The Authority, Njiraini, assured, is confident that the ongoing reform measures shall greatly enhance revenue mobilization besides helping tackle integrity challenges.

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