The Kenya Revenue Authority (KRA) has achieved a significant milestone, collecting KES 1.010 trillion in the first four months of the 2026/27 financial year. This surpasses the trillion-shilling mark a month earlier than in previous years. The Authority attributes this success to a strong October, with collections of KES 260.630 billion, slightly above the target of KES 258.304 billion.
October's collections represent a 15.5% increase compared to the same period last year, nearly double the 8.0% growth recorded in October 2025 and well ahead of the 6.5% posted in October 2024. This growth is largely driven by both customs and domestic taxes beating their targets. Customs had its best month in history, surpassing the previous record set in July.
Taxes on non-oil imports grew by 26%, contributing significantly to the overall growth. However, oil-related imports appear to have collected noticeably less than planned, as non-oil taxes beat their target by KES 7.243 billion, while Customs as a whole cleared its target by only KES 1.009 billion. The KRA's strong performance in customs and domestic taxes has been a key factor in achieving the trillion-shilling milestone.
On the domestic side, corporation tax paid by companies was a standout, coming in almost 20% above target. Firms in electricity, manufacturing, transport, and wholesale accounted for about 81% of this growth, suggesting that the gain rested on a handful of sectors rather than the wider economy. This concentrated growth in specific sectors has contributed to the overall increase in domestic taxes.
Value-Added Tax (VAT) only just cleared its target, but growth in VAT picked up to 21.9% in September and October from 12.2% in July and August. Excise duty, charged on goods such as alcohol and tobacco, beat its target for the first time in a long while. Payments from wine and spirits makers more than doubled, and tobacco payments nearly doubled, both of which the KRA credits to higher deliveries.
The KRA faces a harder test in the coming months, with a target to collect KES 3.268 trillion by the end of June 2027. With 30.9% of that already achieved, the Authority needs to raise about KES 2.258 trillion over the next eight months. This translates to roughly KES 282 billion a month, which is about 8% more than it collected in October and nearly 12% above its average so far this year.
Despite the challenges ahead, the KRA remains optimistic, stating that it is "confident that it will continue with the upward trajectory" and reach its target. The Authority's ability to sustain this growth will depend on how import taxes, company payments, and VAT perform in the months ahead, particularly if the strong corporate gains prove to be more than a one-month spike.
Key points
- KRA collected KES 1.010 trillion in four months, driven by strong customs and domestic taxes.
- October's collections grew by 15.5% compared to the same period last year.
- KRA aims to collect KES 3.268 trillion by June 2027, requiring KES 2.258 trillion over the next eight months.
