Manufacturers say VAT refunds delay is hurting them

Manufacturers say VAT refunds delay is hurting them

The private sector is calling on Kenya Revenue Authority to fasten steps towards refunds on Value Added Tax, VAT.

Kenya Association of Manufacturers Chief Executive Phyllis Wakiaga says the delays have been affecting businesses, including exporters outside the country.

Wakiaga said timely refunds would ease cash flow problems for struggling businesses amid a persistent credit crunch to the private sector.

“We are urging KRA to speed up and improve liquidity and payment of suppliers,” said Wakiaga.

According to the CEO, some businesses have waited for years for the refunds, which has, in turn, affected their liquidity.

The taxman has over the years struggled to clear refund claims, with the bills standing at Sh26.2 billion as of September 2019.

Wakiaga also pointed out that access to markets has poised as a challenge in the industry where many traders are often left stranded with their goods.

“We are keen to get into the African market through the Africa Continental Free Trade Area and the programs that are being out in place should focus supporting SMEs to produce even outside the Kenyan market,” said Wakiaga during the review of the Medium and Small Enterprises policy.

Other challenges affecting the private sector include the pending bills, which the National Treasury has been pushing for the county and national governments.

The amount of eligible pending bills paid by counties as of December 18, was Sh28.57 billion leaving a balance of Sh22.71 billion.

The national government owed a total of Sh58.2 billion of which Sh43.2 billion was contested with only Sh15 billion eligible for payment. Of this, about Sh10 billion was paid by the end of last year leaving an outstanding of Sh4.2 billion.

The National Government had committed to pay the balance by January 15.

Leave a Reply

Your email address will not be published. Required fields are marked *

Sign Up