Kenya ranks behind Rwanda in tax and revenue mobilisation, highlighting the country’s challenges in expanding its domestic revenue base amid persistent collection shortfalls.
A new report by the Mo Ibrahim Foundation ranks Kenya 10th among African countries on tax and revenue mobilisation, with a 2025 score of 67.9 points, compared with Rwanda’s 68.6 points in ninth place.
The UK-based non-profit said its scoring is based on African governments’ ability to mobilise different revenue streams, and the maximum level of taxes a country can collect without detrimental effects.
Kenya’s score improved by 4.6 points from 2015, and the country is among 16 African states classified as showing “increasing improvement”.
This means its 2025 score was higher than in 2016, and they were improving at a faster rate from the midpoint of the period in 2021.
The Mo Ibrahim Foundation, established by Sudanese-British billionaire and philanthropist Mo Ibrahim, assesses and scores governance performance across security, rule of law, economic opportunity, and human development sectors.
It said South Africa led the continent’s tax and revenue mobilisation with a score of 92.4, followed by Côte d’Ivoire at 83.3 and Namibia at 80.0. Lesotho, Senegal, Mauritius, Seychelles and Botswana also ranked ahead of Kenya.
“Within the top ten highest-scoring countries, there is also a large gap between the 10th ranked country, Kenya, which scores 67.9, and South Africa ranked first with 92.4,” the report says.
“This is a gap of 24.5 points across just ten countries, pointing to a wide capacity gap on the continent, even among higher scoring countries.”
Kenya continues to struggle to meet its revenue targets, forcing the National Treasury to rely more heavily on domestic borrowing to bridge budget financing gaps.
The Kenya Revenue Authority (KRA) collected Sh1.81 trillion in ordinary revenue in the nine months to March 2026, missing its Sh1.98 trillion target by Sh161.9 billion.
Corporation tax recorded the largest shortfall among the major tax heads at Sh60.3 billion, followed by Pay As You Earn (PAYE) at Sh50.1 billion and value added tax (VAT) at Sh42.8 billion.
Excise duty missed its target by Sh19.2 billion, while investment income was Sh43 million below target.
The shortfall came despite ordinary revenue increasing from Sh1.58 trillion collected over a similar period a year earlier.
The government has also faced pressure to offer tax relief to cushion households and businesses from economic shocks, including concessions introduced to contain the effects of the US-Israel war on Iran.
The concessions included a reduction in VAT on petroleum products, putting additional pressure on revenue collection at a time when the taxman is already struggling to meet its targets.
Across Africa, the Mo Ibrahim Foundation found that the average score for tax and revenue mobilisation declined by 1.5 points between 2016 and 2025.
“While this deterioration is relatively minor, it highlights the growing gap between the expectations and aspirations surrounding domestic resource mobilisation and the overall reality of the administrative capacity on the ground,” the report says.
South Africa’s score has been around the 90-point mark throughout the decade, which the report says suggests a “robust and mature taxation capacity”.
Rwanda and Kenya were among the 16 countries showing increasing improvement, while the bottom 10 included Somalia at 30.6 points, Democratic Republic of Congo at 29.6, South Sudan at 12.1 and Sudan at 11.8.
Of Africa’s eight regional economic communities, the East African Community (EAC) was the only one to record a positive average 10-year change in its score.
The improvement was largely driven by Somalia, whose score increased by 13.9 points from a low base, following efforts to establish a standardised National Revenue Authority to centralise tax and other revenue collection services.
The Southern African Development Community (SADC) had the highest score among the regional blocs at 60.3 points in 2025, driven mainly by South Africa’s consistent performance.
The Intergovernmental Authority on Development (IGAD) recorded the largest decline at 6.5 points, driven by deteriorations in Eritrea, Djibouti and Sudan.
