The Kenya Revenue Authority (KRA) has raised the alarm over a sharp rise in Value-Added Tax (VAT) fraud involving nil and non-filers, revealing that it lost an estimated Sh13 billion in revenue between April 2024 and July 2025.
This was on account of fraudulent tax practices primarily linked to the re-emergence of the Missing Trader scheme, which involves companies issuing eTIMS-compliant invoices but failing to remit the corresponding VAT.
These so-called missing traders have exploited gaps in the tax system, undermining government revenue collection efforts.
An analysis by KRA shows that 10,771 taxpayers claimed purchases worth Sh29.8 billion from 2,750 nil or non-filing entities during the reporting period, leading to a Sh4.7 billion VAT shortfall.
