Recent internal communication from the Kenya Revenue Authority(KRA) indicates that they have resolved to remove taxpayers previously placed on the special table, marking a significant shift in the authority’s compliance enforcement approach.

The move by KRA reflects an effort to balance effective tax enforcement with the need to facilitate legitimate business activity. While the authority continues to focus on combating tax fraud and missing trader schemes, the revised approach aims to ensure that compliance tools are applied proportionately and only where genuine tax risks exist.

Background: What is the Special Table?

The VAT Special Table is an internal compliance tool previously used by KRA to flag taxpayers suspected of involvement in tax evasion, VAT fraud, or other tax-related offences. Once placed on the Special Table, a taxpayer’s transactions would often be subjected to heightened scrutiny, which could affect the processing of tax claims, processing of invoices, and overall compliance monitoring.

The tool was initially introduced as part of KRA’s compliance programme to act as a deterrent against tax fraud and criminal tax schemes, particularly those involving fictitious transactions or abusive tax arrangements.

Issues with the Use of the Special Table

According to the memo dated 10 March 2026, KRA noted that the Special Table had gradually evolved beyond its original purpose. Instead of being used strictly for combating fraud and tax crime, it had increasingly become a tool for abused and punishing genuine Taxpayers.

This tool has led to unintended consequences, including the punishment of legitimate businesses and compliant taxpayers, potentially disrupting normal business activity and undermining KRA’s primary objective of facilitating business while ensuring tax compliance.

Key Directive Issued by KRA

To address these concerns, KRA has directed that:

Placement of taxpayers on the Special Table has been discontinued with immediate effect. The only exception will be taxpayers involved in:

• Missing trader schemes
• Tax fraud or tax crime

Where such cases arise, the process for placing a taxpayer on the Special Table will require a formal submission explaining the nature of the scheme which the taxpayer is involved in, which must be approved by the Deputy Commissioner, through the manager or chief manager.

Removal of Existing Taxpayers from the Special Table

The memo further directs that all taxpayers currently on the Special Table for reasons other than missing trader schemes or tax fraud will be removed unconditionally and immediately.

Relationship managers have been tasked with notifying affected taxpayers of their removal from the Special Table and communicating what is expected from them for compliance purposes.

Implications for Taxpayers

For taxpayers, the decision is expected to:

• Reduce administrative and compliance barriers
• Restore normal processing of tax-related transactions
• Improve the overall business environment by supporting compliant taxpayers

Are you facing tax compliance challenges, increased KRA audits, reviews, or assessments, or require support in navigating KRA’s technology-driven enforcement environment? Our team is well equipped to assist. Reach out to us via info@skm.co.ke, and our specialised tax experts will provide practical guidance to help you manage risk, resolve issues efficiently, and maintain full compliance.