County administrations are standing in the way of the Commission on Revenue Allocation’s efforts to boost local revenue, with senators being told that some devolved units are refusing to grant the commission access to their systems.
The development comes as Parliament considers a national law to harmonise revenue collection across all counties.
During a session of the Senate Finance and Budget Committee, CRA officials said the lack of cooperation has slowed plans to identify loopholes and strengthen revenue processes.
“Some counties are resisting these efforts. They are not giving us access to systems,” the commission told the committee.
CRA chairperson Mary Chebukati explained that the commission, together with the World Bank and other partners, has developed a mapping tool and training programme aimed at helping counties maximise own-source revenue without raising taxes.
The initiative seeks to narrow the gap between what counties are expected to collect and what they actually raise.
Counties were projected to mobilise Sh216 billion last year from local sources, but only Sh67.3 billion was realised.
“Even the big counties you hear about, as much as they are collecting more, their systems are still not optimal,” Chebukati said.
“What we do is visit the counties, assess their systems, rank them, and then assist in addressing weak areas,” she added.
Chebukati noted that weak performance is linked to unrealistic revenue targets, heavy reliance on manual processes, and poor integration across streams, which has created opportunities for pilferage and inefficiency. In some cases, counties spend up to Sh8 to collect Sh3.
“This leads to budget deficits, negatively affecting implementation of planned activities and contributing to the accumulation of pending bills,” the commission said.
The CRA has urged counties to focus on expanding their revenue bases rather than increasing tax rates.
Chebukati highlighted property rates as a largely untapped source, pointing out that counties without updated valuation rolls cannot levy or collect these fees effectively.
“If they do not have valuation rolls, they are unable to charge property rates. We are supporting them in many aspects, including automation and policy development,” she said.
To further support reforms, the commission has drafted public finance management policies to guide counties in passing relevant laws and identifying viable revenue streams.
Chebukati said digitisation and system integration would link compliance with service delivery, for example by blocking business licences for property owners who have not paid their land rates.
“Most of the money we are losing is through pilferage and lack of system integration,” she added, while noting that resistance from some counties could be due to fears that audits may expose revenue leakages.
