Abstract

This study aims to establish the way forward for designing and implementing a cooperative compliance programme (CCP) for Kenya. Specifically, the paper seeks to examine the current relationship management framework in Kenya through the lens of a cooperative compliance framework and explore the strategic options for Kenya in designing a CCP to meet its specific needs. The study adopts a mixed research approach: desk research, key informant surveys and focus group discussions. The study identifies gaps in the current relationship management framework that need to be addressed. These included the need to fully understand the unique characteristics of large taxpayers and the context in which tax planning occurs; proper planning and coordination of tax audits by various departments; better handling of tax disputes (which should be centralised and well-coordinated); prompt refund payment; and effective engagement of taxpayers in the formulation of new tax policies and amendment of tax laws. Further, the study proposes strategic initiatives for the design and implementation of a cooperative compliance programme in Kenya. The study concludes by providing a way forward for Kenya, which includes a multi-stakeholder approach to designing a cooperative compliance programme, piloting the programme before full adoption, and implementing the programme through a phased approach.