For some traders in Kenya’s bustling informal markets, switching a paybill number, closing a Lipa Na M-Pesa till, or simply reverting to cash has long seemed like a clever way to stay off the Kenya Revenue Authority’s radar. In 2026, that window is closing fast.
Speaking on Wednesday, March 25, 2026, during a Creative Engagement on Fiscal Justice with the Youth and Media, Maurice Oray, KRA’s Deputy Commissioner in the Policy and Tax Division, revealed that the authority will monitor all sources of income after observing a trend among sections of Kenyans who file nil returns a trend now firmly extending to mobile money activity.
His warning was unambiguous. “We are not stopping you from filing nil returns, but we will flag transactions you have made, especially via mobile money,” Oray said.
At the centre of the crackdown is a growing concern about widespread filing of nil tax returns by individuals whose mobile wallets tell a different story. KRA has confirmed that it will monitor transactions across mobile platforms to identify discrepancies between reported income and actual financial flows, and is rolling out pre filled tax returns where known income streams are automatically captured.
The pattern of evasion is well documented. Traders who previously accepted payments through Lipa Na M-Pesa ,Buy Goods Till numbers began closing those accounts once KRA enforcement intensified, asking customers to pay in cash instead. KRA spotted the trend early and moved to close the gap by working directly with Safaricom to get data on merchants who dropped off the platform.
KRA have already identified 392,162 firms and wealthy individuals owing Sh759.7 billion, following an income and expenditure verification exercise that began on January 1, pulling data from eTIMS invoices, withholding tax certificates, and import documents. “We are now making a serious and unprecedented effort around having visibility of transactions in the economy,” said George Obell, KRA’s Commissioner for Micro and Small Taxpayers. “The information that is hitting our system through eTIMS tells us who is transacting, whom they are transacting with and how much they are transacting.”
KRA can track mobile money transactions such as M-Pesa and review bank statements, flagging individuals who regularly receive large or unexplained sums while declaring little or no income. The taxman has also increasingly deployed artificial intelligence to analyze data and detect suspicious patterns.
Kenya’s tax compliance landscape is evolving from rules-based reporting to data-driven, technology-enabled enforcement. “In 2026, the penalty for complacency won’t just be financial it will be competitive extinction,” tax consultant Wambui Gitau warned in a February 2026 analysis.
For traders tempted to switch channels or go dark, KRA’s message is the same it has been since the crackdown began there is nowhere to hide.
