The Kenya Revenue Authority (KRA) has announced a significant step towards simplifying tax compliance for informal sector participants and small businesses.

This move aims to ensure all businesses, regardless of size or formality, electronically generate and transmit their invoices to the authority through the eTIMS system.

"Kenya Revenue Authority (KRA) would like to remind the public that all persons carrying on business including those in the Informal Sector and Small Businesses are required to electronically generate and transmit their invoices to KRA via the electronic Tax Invoice Management System (eTIMS)," KRA stated.

Facilitating Compliance, Not Friction

KRA emphasizes a collaborative approach to tax compliance.

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They acknowledge the potential challenges faced by smaller businesses and have developed "eTIMS Lite," a simplified version of the eTIMS system accessible through user-friendly platforms.

Non-VAT registered taxpayers can now utilize either the USSD-based invoicing solution by dialing *222# or the web-based option at ecitizen.kra.go.ke.

This eliminates the need for complex software installations, making eTIMS adoption more accessible.

Beyond Solutions: Education and Collaboration

KRA's efforts extend beyond offering simplified solutions.

Recognizing the importance of tax education, they have actively engaged with informal sector stakeholders.

This includes farmers, jua kali artisans, and various representative groups and associations. These partnerships aim to provide direct support to taxpayers in these sectors, ensuring a smooth transition to the eTIMS system.

Open to Customization: Addressing Specific Needs

KRA acknowledges that one-size-fits-all solutions might not always work.

They welcome inquiries from taxpayers and representative bodies who encounter challenges with the existing options.

The authority is open to exploring customized solutions to cater to specific needs. One such possibility is the concept of "reverse invoicing," where a seller grants permission to the buyer to issue invoices on their behalf.

This move by KRA demonstrates their commitment to creating a more inclusive tax environment.

By providing user-friendly solutions, educational initiatives, and openness to customization, they are empowering the informal sector and small businesses to contribute their fair share to the nation's growth.