Kenya Revenue Authority misses quarterly target by Sh58.2 billion — Nation Kenya

The Kenya Revenue Authority (KRA) recorded a shortfall in ordinary revenue of 58.2 billion Kenyan shillings in the first quarter of the 2026/27 financial year. At the same time, receipts in the three months through the end of September increased compared with the same period a year earlier.

Revenue below target

Ordinary revenue, which includes tax and non-tax receipts, amounted to 655.8 billion shillings, 14.4% more than the 573.5 billion shillings recorded in the corresponding period of 2025, Nation Kenya reports, citing data from the country’s National Treasury.

Overall, receipts through the end of September were 40.4 billion shillings below target. According to the Treasury, the 58.2 billion-shilling shortfall in ordinary revenue was partly offset by appropriations in aid, which exceeded the target by 17.8 billion shillings.

The largest shortfall was recorded in income tax receipts, which amounted to 297.9 billion shillings against a target of 323.3 billion, or 25.4 billion shillings less. Excise tax receipts also fell 16.3 billion shillings short of the target. Of all major tax categories, only import duty did not fall behind plan.

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Rising expenditure and deficit

By the end of September, government expenditure exceeded the planned level by 116.9 billion shillings. Recurrent expenditure was 59.3 billion above plan, development expenditure was 34.7 billion higher, and transfers of revenue shares to county governments were 22.9 billion shillings above plan.

The budget deficit including grants for the first three months of the financial year reached 329.1 billion shillings, or 1.6% of GDP. This exceeded the planned 174.8 billion shillings, or 0.8% of GDP.

The National Treasury cites a shrinking revenue base, public debt and growing expenditure needs among fiscal risks. By its estimate, the share of domestic revenue in GDP declined from 18.1% in the 2013/14 financial year to a projected 13.9% in 2026/27. The government expects to increase receipts by simplifying tax legislation, reviewing tax exemptions and increasing non-tax revenue from public services.