The Kenya Revenue Aut**rity (KRA) has collected over KShs 21 b***ion from its Alternative Disputes Resolution (ADR) mechanism. This is after KRA resolved 393 ADR cases this financial year (July 2020 to March 2021).
The ADR mechanism which was implemented by KRA in 2015 has seen significant growth in terms of the number of cases resolved and the revenue unlocked. This positive trajectory is marked by a 109% growth in the number of cases and 389% growth in revenue unlocked this financial year 2020/2021 (July 2020-March 2021) when compared to a similar period last financial year 2019/2020.
The Tax Procedures Act provides that under the ADR framework, disputes s**uld be resolved within 90 days. This is to ensure that disputes are resolved in an ex***itious and timeous manner. Alt**ugh the law allows for 90 days, resolution of cases under ADR can be achieved in a much s**rter time span.
Unlike other dispute resolution mechanisms, ADR is pocket frie***y as it does not require payment of any filing fees. It is a mediation process in which a taxpayer can opt to represent himself wit**ut the need for an Advocate or a tax representative.
READ ALSO>>>>>Beat Deadline by Filing Tax Returns on New KRA M-Service App and iTax
Despite the current Covid-19 ******** related challenges, resolution of disputes through ADR has remained unhampered as meetings are conducted virtually. This has further reduced the time within which the meetings are held. The average time taken to resolve ADR cases has been reduced from 89 days in Financial Year 2019/2020 to 42 days in the current financial year 2020/2021.
The ADR process preserves the relationship between the taxpayer and the Aut**rity. The mediator ensures that parties are not antagonized and maintains cordial relationships. The process provides a win-win outcome for the parties which leaves both parties happy with the outcome and prevents the further escalation of disputes. A good example of this is when a taxpayer is allowed to present do***ents for verification under ADR, which do***ents would otherwise be rejected in a Tribunal or Court hearing in strict adherence to the law governing admission of evidence.
Taxpayers have embraced ADR and this is evidenced by the increasing number of ADR applications being received by KRA. In the current financial year, KRA recorded a 56% growth in the number of ADR applications from 425 received in the financial year 2019/2020 to 661.
Leave a comment