The Kenya Revenue Authority (KRA) has submitted a proposal to the National Assembly’s Finance and National Planning Committee to use government pending bills as a tool for recovering unpaid taxes from large and medium taxpayers.

The Treasury estimates that the government owes roughly Ksh175 billion to businesses, many of whom have been waiting for payments for years, prompting calls for a faster resolution.

KRA missed its FY2026 revenue target by Ksh132.1 billion, collecting Ksh2.844 trillion against a goal of Ksh2.977 trillion, intensifying pressure to find new revenue streams.

The proposed mechanism would identify suppliers awaiting payment from government agencies and offset the amounts they are owed against their outstanding tax liabilities.

To support the initiative, KRA is deploying technical teams to match data from third‑party systems, including the Integrated Financial Management Information System (IFMIS), with its own tax records.

The authority also plans to reconcile withholding tax on payments for goods supplied to government entities and corporate buyers, and to offset approved tax refunds against any remaining liabilities.

KRA disclosed that it itself has pending bills totalling Ksh5.58 billion as of 30 June 2026, the bulk of which relates to Excise Goods Management System stamp payments.

Other outstanding obligations include Ksh416.36 million owed to the Administration Police Service for security services.