Treasury Expected to Raise Ksh.759 Billion in Three Months

The National Treasury is expected to raise Ksh.759.1 billion in three months to the end of the fiscal year in June amid hardships brought forth by the COVID-19 pandemic.

Recent data from the Treasury as of March 31 shows that the total revenues collected in nine months inclusive of ministerial appropriation in aid (A-i-A) stood at Ksh.1.325 trillion against a target of Ksh.1.537 trillion to show a gap of Ksh.211.9 billion.

Normal revenues which are representative of government income from taxes stood at Ksh.1.216 trillion against a target of Ksh.1.348 trillion or an equivalent Ksh.132.3 billion shortfalls.

According to data from the 2020 Budget Policy Statement, total revenue to June is estimated at Ksh.2.084 trillion to represent a split of Ksh.1.843 trillion and Ksh.240.3 billion in ordinary revenues and ministerial aid respectively or an equivalent 20.1 percent of GDP.

Treasury Cabinet Secretary Ukur Yatani in his presentation of the second supplementary estimates to Parliament this week expressed his worries over a potential shortfall in revenues owing to a slowdown in economic activity.

“The implementation of the 2019/20 budget continues to face various challenges. These include the COVID-19 pandemic which has slowed down the economic performance, the underperformance of projected revenues and the increased demand for additional priority expenditures,” he said.

On Tuesday, the Treasury proposed second round adjustments to the 2019/20 budget to include a Ksh.74.4 billion slash on spending by the national government in addition to a Ksh.24.8 billion haircut to pension obligations and interest payments on debt.

Already, the National Treasury is expected to take a further hit in revenues from last month’s Presidential tax-relief announcement with the Parliament Budget Office (PBO) projecting a revenue loss of Ksh.122.3 billion or an equivalent 1.2 percent of GDP.

On average revenue collections in the past three quarters have averaged Ksh.147.2 billion a month pointing to a minimum Ksh.317.5 billion shortfall to full-year collections.

Total Revenues across the 2018/19 fiscal year stood at Ksh.1.671 trillion against a target of Ksh.1.794 trillion to represent a Ksh.123.2 billion shortfall.