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  • Why Mary Wambui’s Move To Delete Sh2.2 Billion Tax Evasion Articles Is Morally Untenable — And A Closer Look Into The Controversial Withdrawal

    Why Mary Wambui’s Move To Delete Sh2.2 Billion Tax Evasion Articles Is Morally Untenable — And A Closer Look Into The Controversial Withdrawal

    In 2014, the Court of Justice of the European Union handed a Spanish man named Mario Costeja Gonzalez the right to have Google suppress links to a decades-old newspaper notice about a debt auction he had long settled. The judgment was proportionate. The matter was resolved. The man was a private citizen. The information had no continuing public interest. European courts subsequently codified the right to be forgotten in law.

    Twelve years later, a Kenyan businesswoman who supplies military boots and cereals to the government, who funded presidential campaigns, who chairs a public regulatory body, and whose company is the subject of ongoing parliamentary and prosecutorial scrutiny has invoked that same Spanish man’s victory in a Kiambu High Court petition seeking to force Google to bury 35 news articles about her Sh2.2 billion tax evasion case.

    The two cases have almost nothing in common. And the audacity of the comparison reveals everything that is wrong with Mary Wambui Mungai’s petition.

    She is not asking for privacy. She is asking for impunity on demand — a digital eraser funded by the same wealth the public never saw taxed.

    The Anatomy of a Case That Disappeared

    The facts of the underlying tax matter are not disputed by Ms Wambui herself. In December 2021, she and her daughter Purity Njoki Mungai, both directors of Purma Holdings Limited, were arraigned at the Anti-Corruption Court in Milimani on eight counts of knowingly and unlawfully omitting income taxes between 2014 and 2019. The alleged unpaid taxes amounted to Sh2,231,789,125 — money that flowed from enormous state contracts for supplying boots, uniforms, cereals and medical supplies to the military, the Kenya Medical Supplies Authority (KEMSA) and other government departments.

    What followed was a masterclass in the art of evasion. When the Kenya Revenue Authority first summoned her in June 2021, she did not appear. When KRA pushed for her arrest, she reportedly surfaced at Weston Hotel — a property publicly associated with then-Deputy President William Ruto — and slipped away, leaving behind personal belongings including an identity card, bank cards, a firearms licence and a temporary travel permit to Zambia. The Directorate of Criminal Investigations issued arrest warrants. Airport and border checkpoints were sealed. The country watched a billionaire tenderpreneur duck and weave.

    KEY FACT: Wambui was also separately charged in January 2022 with illegal possession of a pistol and 22 rounds of ammunition without valid licences. That case was dropped in December 2022 — one month before the tax case was also withdrawn.

    By December 2022, President Ruto — the same man in whose hotel she had sheltered from police — appointed her chairperson of the Communications Authority of Kenya’s board. Days later, KRA wrote to the DPP requesting withdrawal of the charges, citing a December 6 compounding of offences and payment of fines. The case was withdrawn on January 10, 2023.

    She walked free. She did not receive an acquittal. She was not found innocent. She paid fines. The state absorbed the settlement. The public never learnt what the final tax figure paid was, or whether it bore any relationship to the Sh2.2 billion originally charged.

    A compounding of offences is not vindication. It is a transaction. Wambui bought her way out — and now wants to erase the receipt.

    The Google Petition: Anatomy of Reputation Laundering

    Ms Wambui’s petition, filed at the Kiambu High Court, asks the court to order Google LLC and Google Kenya Ltd to suppress all 35 links to news stories covering the tax evasion probe and the court proceedings from 2021 to 2023. She wants a temporary injunction prohibiting the links from appearing in searches pending determination of her substantive petition, which seeks their permanent removal.

    Her legal arguments rest on three pillars: the EU right to be forgotten as established in the Gonzalez judgment, section 25 of Kenya’s Data Protection Act, and constitutional Articles 28, 31 and 33 protecting dignity, privacy and reputation. Each argument falls apart on contact with the facts.

    On the EU precedent: the Gonzalez ruling explicitly excludes matters of genuine public interest from the right to be forgotten. A Sh2.2 billion criminal prosecution involving a government supplier who was evading taxes earned from public coffers is self-evidently a matter of public interest. The EU itself applies the public figure doctrine — holding elected officials and those in public life to lower privacy expectations regarding their exercise of public functions. Ms Wambui, as Communications Authority chair and now Athi Water Works board chair, is a public figure performing public functions.

    On the Data Protection Act: Section 25 requires that personal data be processed fairly and lawfully. News articles about public court proceedings are not ‘personal data’ in the private sense the Act is designed to protect. Court records are public by design. Journalism about criminal charges is protected expression. The Act was conceived to guard against surveillance, unauthorised data harvesting and digital exploitation — not to give powerful individuals a legal mechanism to suppress accountability journalism.

    On the constitutional arguments: Article 33, which she invokes to protect her reputation, must be read alongside Article 34, which protects freedom of the press, and Article 35, which guarantees the public’s right to access information. The Constitution does not rank reputation above press freedom, especially where the subject of reporting is a public official and the reported events are matters of public record.

    NOTABLE: Four of the 35 links Wambui wants suppressed lead to articles published by the Kenya Revenue Authority itself — the government’s own tax body. She is asking a court to help her bury the taxman’s own public record of the case.

    The Real Motivation: Sending Investors a Clean Search Page

    In her court papers, Ms Wambui is unusually candid about why these articles harm her. She states that ‘business engagements, particularly those involving foreign clients, donors, and partners, have been disrupted, as international stakeholders who carry out online due diligence encounter the outdated articles and are misled into doubting my integrity and suitability for engagement.’

    This is a confession dressed as a complaint. She is not arguing that the articles are false. She is arguing that they are inconvenient. Specifically, she is arguing that they are inconvenient to the due diligence process of her foreign investors and business partners. She wants to be able to send prospective partners a Google search result page that tells only the sanitised version of her story.

    What Ms Wambui calls ‘outdated information’ is, more accurately, accurate information about events that actually occurred. The prosecution happened. The arrest warrants were real. The eight criminal counts were formally charged. The fines were paid. The case is part of the permanent public record of the Kenyan court system. No Kiambu court order can change that. What she is asking Google to do is to ensure that investors who search her name cannot easily find that record.

    This is not a privacy case. This is a cover-your-tracks case — and the court must see it clearly.

    The Weston Hotel Escape: What The Record Shows

    For investors and partners conducting due diligence, the tax case is not the only chapter of the Wambui record that demands scrutiny. When KRA moved to have her arrested in December 2021, she was tracked to Weston Hotel along Langata Road — a property publicly and extensively associated with President Ruto. According to investigative reporting at the time, she and her daughter departed in a hurry, leaving behind personal items that no innocent person flees from police with.

    A court subsequently unfroze 13 of her bank accounts after a High Court judge found KRA had frustrated her stated willingness to pay. The unfreeze came before the compounding. The sequence matters: accounts unfrozen, a deal struck, fines paid, political appointment received, case withdrawn. All within a span of weeks straddling the December 2022 presidential appointment.

    The timing is not subtle. The appointment preceded the withdrawal by five weeks. The withdrawal preceded the formal dropping of the firearms case by the same prosecutorial office. Ms Wambui is right that the search results damage her reputation with foreign partners. Those foreign partners should be grateful for the information.

    A Pattern of Tenders, Scandals and Legal Intimidation

    The Sh2.2 billion tax case is not a standalone incident. It is the first published chapter in what has since become an extensive and documented record of controversies clustering around Purma Holdings and associated entities.

    In 2023, barely months after the tax case was closed, trade CS Moses Kuria disclosed in Senate testimony that Purma Holdings had been awarded KNTC contracts to supply 30,000 metric tonnes of rice, 12,500 tonnes of edible oil, and 20,000 tonnes of beans. Court testimony by KNTC Managing Director Lucy Anangwe subsequently established that Purma Holdings was paid Sh3.9 billion for rice whose actual market value was Sh3.1 billion — a Sh800 million markup that came out of the public purse. She also secured Sh2.5 billion for edible oil and Sh3.4 billion for beans, bringing the KNTC exposure alone to roughly Sh9.8 billion across these contracts.

    Separate associated entities — Charma Holdings, Enterprise Supplies Ltd and Evertec General Trading Company — each received additional KNTC contracts worth hundreds of millions. All four companies have documented connections to Ms Wambui’s network. The EACC opened an investigation. Former KNTC boss Pamela Mutua was charged. Ms Wambui’s companies were not charged. The pattern is consistent: proximity to scandal, distance from accountability.

    PATTERN: When Nation Media Group published the KNTC edible oils investigation in October 2023 linking Purma Holdings to the scandal, Wambui’s lawyers immediately demanded a retraction and threatened defamation action. NMG did not retract. The same playbook — suppress, threaten, litigate — is now being applied to Google.

    In 2024, the Directorate of Criminal Investigations froze bank accounts linked to her companies over the KNTC contracts. That freeze contributed, by her own account in court filings, to her inability to service an Sh8.267 billion loan from Equity Bank, secured against Glee Hotel, her flagship 211-room luxury property on the Northern Bypass.

    Glee Hotel: The Sh8 Billion Debt Mountain

    In January 2026, Nation Media Group reported that Ms Wambui and Glee Hotel Ltd had sued Equity Bank to block a planned February 5, 2026 auction of Glee Hotel after she defaulted on loans totalling Sh8.267 billion. Equity Bank’s court filings indicate that at one point she offered to pay Sh5 billion in full settlement, requesting the bank absorb a haircut of more than Sh3 billion. She later raised the offer to Sh7 billion. The bank declined both.

    The November 2025 correspondence from her camp, according to Equity Bank’s court filings, was not marked ‘without prejudice’ — a legal protection — meaning it constitutes an admission of the debts owed. Among assets charged as security are land parcels in Runda, Westlands, South B, Ruiru, Thindigua, Ruaka and Ongata Rongai. Her daughters are listed as guarantors.

    For a foreign partner or donor doing due diligence, this is the financial landscape: a businesswoman facing a multibillion bank default, whose core company has been implicated in a rice contract markup, whose bank accounts were frozen by the DCI, and who paid her way out of criminal tax charges rather than going to trial. These are not outdated stories. These are live, consequential facts.

    The irony is devastating: Wambui wants to suppress old articles to attract new investors, at the very moment that new articles are exposing why old investors should have been worried all along.

    The Communications Authority and Nightingale: The Conflict That Never Resolved

    When President Ruto appointed Ms Wambui as Communications Authority of Kenya board chair in December 2022, critics immediately flagged that her daughter Evelyn Nyambura Mungai was co-owner of Nightingale Enterprises, which had secured contracts to lay fibre optic cables under the government’s Sh5 billion Digital Super-Highway project. Investigations found that Wambui had transferred her shares in Nightingale to Evelyn shortly before the tender award — a move that critics argued was a cosmetic conflict-of-interest shield.

    The CA regulates the ICT sector. Nightingale was delivering ICT infrastructure under government contract. The Solicitor-General and the CA boss defended the appointment at the time. Ms Wambui served as chair until August 2025 when President Ruto revoked her appointment and simultaneously transferred her to chair the Athi Water Works Development Agency board — yet another parastatal responsible for public funds. The musical chairs of parastatal appointments has never slowed the controversies; it has merely moved them around.

    The Precedent Danger: Why the Court Must Reject This Petition

    The implications of granting Ms Wambui’s petition extend far beyond her personal reputation. If the Kiambu High Court orders Google to suppress search results about a criminal prosecution simply because the charges were tactically withdrawn through a financial settlement, it will establish a principle that any person with enough money to compound a criminal offence can also buy the erasure of the public record of that offence. Kenya’s accountability ecosystem cannot survive that precedent.

    Every corrupt official whose case is dropped by a politically influenced DPP could file similar petitions. Every tender fraudster who cuts a deal with investigators before trial could argue that the dropped charges create a right to be forgotten. Every tax evader who pays fine-level amounts to avoid conviction could demand that journalism about their prosecution disappear from the internet. The right to be forgotten would transform from a tool of personal dignity into a mechanism of institutional impunity.

    The court should also take note of the technical problems with Ms Wambui’s case against the respondents. Google Kenya Ltd has correctly argued that it is a separate legal entity that neither owns nor operates the Google search engine. It provides sales, marketing and research and development services exclusively. Its memorandum of association, attached as evidence, supports this. Google LLC, the actual operator of the search engine, has not filed a replying affidavit. The petition may collapse on jurisdictional technicalities before it ever reaches the merits.

    LEGAL CRACK: If Google Kenya Ltd is not a proper party — as it credibly argues — then Ms Wambui’s case against the entity that actually operates the search engine has a significant jurisdictional problem. The June 10 ruling on the interim injunction will test whether Kiambu court is prepared to grant sweeping relief against a respondent that may have no operational control over the outcome.

    What Foreign Investors Actually Deserve to Know

    Ms Wambui invokes foreign investors, donors and international partners as victims of Google’s search results. She argues they are being misled. The reality is the reverse. What foreign investors deserve is the complete picture — and the complete picture is this:

    The person they are evaluating is a tenderpreneur who built a fortune on government contracts, evaded taxes on that fortune for years, dodged a police dragnet by sheltering in politically connected premises, was charged on eight counts of tax evasion and two counts of illegal firearms possession, had both cases dropped following financial settlements and a high-profile political appointment, subsequently received multibillion-shilling KNTC contracts within months of the case withdrawal, is implicated by court testimony in a Sh800 million rice contract markup, is under an Sh8.267 billion bank default, and is now in court attempting to suppress the journalism that documented all of the above.

    That is not outdated information. That is the most current and relevant due diligence profile available on Mary Wambui Mungai. The 35 articles she wants buried are not a legacy of the past. They are the foundation without which no honest assessment of her present-day dealings is possible.

    If the truth about Mary Wambui’s history damages her reputation, that is the truth doing its job — not an injustice requiring judicial remedy.

    Conclusion: The Court Must Protect Public Interest, Not Private Image

    The Kiambu High Court will deliver a ruling on June 10 on whether to grant interim orders suppressing the 35 links pending the full hearing. That ruling will be closely watched not only by journalists and civil society, but by every Kenyan public official who has survived a criminal case through political intervention and wonders whether the digital record of that survival can be similarly managed.

    The court must reject the interim injunction. It must find that the public interest in the continued accessibility of accurate journalism about a criminal prosecution of a public figure outweighs the private inconvenience that journalism causes to that figure’s business dealings. It must recognise that the right to be forgotten — even if it were codified in Kenyan law — explicitly excludes matters of public interest, and that a Sh2.2 billion tax evasion prosecution of a government supplier is irreducibly a matter of public interest.

    And when the matter goes to full hearing, it must find that Google is not a publisher of defamatory content but an indexer of public information — that the news organisations who wrote the stories are not parties to this suit — and that the remedy Ms Wambui seeks is not available under Kenyan law as it currently stands.

    Mary Wambui built her fortune in the corridors of government procurement. She navigated two criminal cases by paying fines and leveraging political capital. She now chairs a public water authority. She runs a luxury hotel on borrowed billions. She is not a private citizen with a minor embarrassment from a distant past. She is a public figure with an active and ongoing public record.

    The public has a right to that record. The press has a right to report it. Google has no obligation to bury it. And the court has a duty to say so.

  • Nowhere To Hide: KRA Reinstates ‘Nil Returns’ After System Upgrade To Nab Tax Cheats

    Nowhere To Hide: KRA Reinstates ‘Nil Returns’ After System Upgrade To Nab Tax Cheats

    Tax evaders who have been living large while declaring zero income now face an electronic dragnet as the Kenya Revenue Authority brings back nil return filing with teeth-baring validation checks designed to catch every Prado-driving, Dubai-jetting fraudster who claims to earn nothing.

    The taxman announced Friday that nil returns are back, but with a deadly twist. Starting April 1, 2026, when Kenyans file their 2025 income tax returns, a sophisticated artificial intelligence system will cross-check every declaration against a web of third-party data sources that knows what you drive, where you shop, how much M-Pesa flows through your phone, and whether you’ve been importing luxury goods while crying poverty to the taxman.

    The move ends weeks of anxiety after KRA shocked taxpayers in January by temporarily suspending nil filing altogether, sending small businesses and genuine unemployed youth into panic about penalties and compliance certificates. But the taxman wasn’t backing down. It was sharpening its knives.

    “The Nil Filing Return option has been reinstated after the necessary system validations were embedded for the 2025 returns to be filed after March 31, 2026,” KRA’s Business Strategy, Technology and Enterprise Modernisation Department announced, signaling the end of the free lunch for Kenya’s shadow economy.

    For 2024 returns and earlier periods, taxpayers can still file as before. But come the June 30 deadline for 2025 income year returns, every nil declaration will pass through what KRA officials privately call “the gauntlet,” a system designed to separate genuine zero-earners from the tenderpreneurs and consultants who’ve been gaming the system for years.

    The crackdown comes after KRA caught a staggering 392,162 taxpayers red-handed. These individuals had taxes withheld from their earnings in 2024, proof positive they earned money, yet brazenly declared nil income when filing their returns. The discovery exposed a massive loophole that has cost the country billions in lost revenue.

    Commissioner for Micro and Small Taxpayers George Obell laid bare the scale of the fraud in a January interview that sent shockwaves through tax circles. “When we check the system, we can see that these taxpayers still had transactions in 2024, yet they filed nil returns,” he said, his frustration evident.

    The most common scam involves a fundamental misunderstanding, or willful ignorance, about withholding tax. Many professionals earning fees for consultancy, management services, or contract work believe the 5.0 percent or 3.0 percent tax deducted at source is final. It is not.

    “That is not correct. It is an advance tax,” Obell emphasized, destroying the favorite excuse of thousands who thought they’d found a permanent escape hatch.

    Now, KRA is turning that misconception into a weapon. Starting this filing season, the taxman will prepopulate income tax returns with every shilling it knows you earned, pulling data from withholding tax certificates, electronic invoices, bank transactions, mobile money flows, customs records, and even vehicle registration data from the National Transport and Safety Authority.

    “This time, when we say we are prepopulating returns, that income will already have been captured by the time the taxpayer is seeing the return, and one will not be able to avoid it. Because we already have visibility of the 5.0 percent, we know what the total income is,” Obell warned.

    The message is chilling: you cannot hide what KRA already knows.

    The electronic Tax Invoice Management System, or eTIMS, sits at the heart of this revolution. Every transaction at supermarkets, service providers, import clearances, even the corner shop, is now logged and linked to your PIN. If your spending exceeds your declared income, the system flags you automatically for audit.

    Integration with Customs and Immigration means KRA can see if you cleared a Range Rover or flew business class to London. Mobile money platforms like M-Pesa provide real-time data showing the velocity of cash through your accounts. If money is moving, KRA knows about it.

    Critics warned the suspension of nil filing in January unfairly targeted genuine unemployed youth and struggling small businesses. A recent graduate in Githurai with truly zero income feared being trapped between compliance requirements and a system that assumed everyone was cheating.

    KRA insists it has balanced concerns. No penalties will apply during the transition, and simplified digital tools launching in February will let genuine nil-filers comply with a single click. But the authority makes no apologies for hunting down the wealthy who masquerade as paupers.

    “We will also communicate to taxpayers who choose, despite having been shown income on their prepopulated returns, not to come forward and engage the authority. That in itself will be an invitation to look not just at 2025 but also preceding years,” Obell warned, making clear that defiance invites deeper scrutiny stretching back years.

    The stakes are enormous. Out of Kenya’s 8 million registered taxpayers, only 4 million actually pay tax. The burden falls disproportionately on salaried workers who have PAYE deducted automatically, while the shadow economy thrives. Micro and small businesses contribute just 14 percent of domestic tax collections, despite dominating the economy.

    KRA Deputy Commissioner Patience Njau made the authority’s intent crystal clear in January. “This year, our focus will be very different as we aim to convert the nil and non-filers and zero payers into paying taxpayers,” she declared, signaling that 2026 marks a turning point.

    The Income and Expenditure Verification programme, which launched January 1, pulls data from multiple sources simultaneously. It compares declared income against eTIMS invoices, withholding tax certificates, import documentation, and bank records in real time. Any mismatch triggers immediate review.

    Tax experts warn that this represents a fundamental shift in Kenya’s compliance landscape. Where taxpayers once filed summary returns that KRA might audit later, the system now validates continuously and automatically at the point of filing. There is no grace period for “post-filing explanations.”

    For those tempted to test the system, the consequences are severe. Upward tax adjustments, penalties accumulating at 1 percent monthly interest, and possible denial of the Tax Compliance Certificate that unlocks everything from government tenders to bank loans await the defiant.

    Legal observers have questioned whether KRA’s temporary suspension of nil filing in January exceeded its statutory authority. Tax lawyer Ogun Owino argued the move violated principles of legality, noting that the Tax Procedures Act gives no discretion to suspend due dates administratively.

    “It is irrational to take an administrative decision that undermines a written law without public participation. That amounts to a fiat and flies in the face of principles of legality and common sense,” he wrote, accusing KRA of creating uncertainty when traders need compliance certificates to unlock payments, secure tenders, or meet statutory requirements.

    KRA has ignored such criticism, betting that the judiciary will back efforts to expand the tax base when the alternative is fiscal collapse. The government, constrained by massive debt and a shrinking borrowing window after the 2024 protests, desperately needs every tax shilling it can collect.

    The authority has urged taxpayers to verify their PINs on iTax and ensure accuracy as the system increasingly relies on consolidated data streams. Failure to update information could mean your legitimate expenses get disallowed or innocent transactions get flagged.

    For Kenya’s tenderpreneurs, consultants, and freelancers who have thrived in the grey zone between formal employment and complete informality, the message from Times Tower is unambiguous. Big Brother is watching, he knows what you earn, and come June 30, there will be nowhere to hide.

    The filing deadline remains June 30, 2026, for all individual taxpayers. Late filing attracts a Ksh2,000 penalty, or 5 percent of tax due, whichever is higher. Late payment accrues interest at 1 percent monthly.

    KRA’s citizen assembly initiatives and plans to recruit 10,000 tax agents across the country suggest the authority is playing a long game. Build compliance culture early, make the system simpler for genuine users, and hunt down the cheats with technological precision.

    Whether this strategy will finally level the playing field between salaried workers and the shadow economy remains to be seen. What is certain is that 2026 marks the year tax compliance in Kenya went digital, automated, and unforgiving.

    For hundreds of thousands of Kenyans who thought nil returns were a permanent shield against taxation, that shield just developed gaping holes. The taxman cometh, and this time, he’s armed with algorithms.

  • Del Monte’s Billion-Shilling Tax Dodge Exposed: How Foreign Giants Are Bleeding Kenya Dry

    Del Monte’s Billion-Shilling Tax Dodge Exposed: How Foreign Giants Are Bleeding Kenya Dry

    Multinational pineapple producer caught red-handed siphoning profits offshore while ordinary Kenyans shoulder crippling tax burden

    The veil has been lifted on one of Kenya’s most brazen corporate tax scandals, with Del Monte Kenya now facing a KSh1.76 billion bill after a tribunal exposed how the multinational used shadowy offshore deals to rob the country of desperately needed public funds.

    In a damning ruling that has sent shockwaves through Kenya’s corporate sector, the Tax Appeals Tribunal dismissed Del Monte’s appeal and upheld the Kenya Revenue Authority’s assessment, confirming what ordinary Kenyans have long suspected: some of the country’s biggest and most profitable companies are systematically cheating the tax system while workers and small businesses are squeezed to breaking point.

    The case centers on transfer pricing, a complex financial maneuver that allows multinationals to manipulate the prices they charge their own foreign subsidiaries, artificially slashing their Kenyan profits and shifting billions to tax havens where rates are lower or non-existent.

    KRA’s 2018 audit uncovered that Del Monte was using a cost-plus pricing model that grossly undervalued its Kenyan operations while funneling inflated profits to related companies abroad, particularly its Swiss affiliate DMI GmbH. The tribunal found the pineapple giant could not justify why it was earning modest returns in Kenya, where all the real work happens, while its offshore entities raked in the profits.

    “The tribunal found that the pineapple giant could not justify why it was shifting profits to offshore companies when the real value of the business is created in Kenya,” the ruling stated, laying bare the mechanics of corporate tax abuse.

    Del Monte had argued it was simply following a standard cost-plus approach, applying a meager 4.83 percent markup to its costs when selling to its Swiss sister company. The firm insisted this was fair compensation for its role as a manufacturer supplying a related distributor.

    But the tribunal was having none of it. Judges ruled that Del Monte’s documentation failed to reflect the economic reality of its massive Kenyan operations. The company could not explain why the Kenyan business, which does all the planting, harvesting, processing and initial distribution, should earn only a pittance while foreign affiliates that simply handle onwards sales captured the lion’s share of profits.

    The ruling also exposed Del Monte’s attempts to obscure its corporate structure. The company claimed a multi-billion shilling intercompany loan came from Del Monte Fund B.V., owned by its ultimate parent in the Cayman Islands, a notorious tax haven. But KRA presented registry records proving the lending entity was actually wholly owned by the Swiss affiliate, a finding Del Monte could not refute with official documentation.

    The KSh1.76 billion that Del Monte sought to avoid paying could have transformed lives across Kenya. According to the Kenya Human Rights Commission, which welcomed the tribunal’s decision, that money could build 1,760 public school classrooms, construct eight fully equipped county hospitals, tarmac 29 kilometers of road, employ over 3,500 nurses or teachers for a year, or fund multiple rural water projects.

    Instead, while Del Monte contested billions in taxes through expensive legal battles, ordinary Kenyans were being told to tighten their belts, accept higher VAT on basic goods, and pay new levies on essential services.

    The Kenya Human Rights Commission pulled no punches in its response, accusing Del Monte and other multinationals of looting what rightfully belongs to Kenyan citizens.

    “For years, ordinary Kenyans have been told to tighten their belts, pay more VAT, and accept new levies on basic goods and services. However, some of the country’s largest and most profitable corporations, like Del Monte, continue to aggressively contest paying billions in taxes. This is unjust and unacceptable,” the commission said in a scathing press statement.

    The rights body warned that corporate tax evasion weakens the state’s ability to deliver basic services and shifts the tax burden onto workers, small businesses and low-income households. When multinationals dodge taxes, children sit in overcrowded classrooms, patients go without medicine, and communities lack clean water.

    KHRC revealed it is now examining other corporations, focusing on the land they occupy, the terms of their leases, and what they actually pay in land rates and taxes. Early findings suggest the scale of revenue loss will shock many Kenyans, especially at a time when households are strained by PAYE, VAT and rising levies on basic necessities.

    The commission is demanding sweeping reforms to stop multinationals from bleeding the country dry. It wants all foreign corporations operating in Kenya to publicly disclose their revenues, profits, taxes paid, number of employees and assets for each country where they operate. It is calling for a dedicated, well-resourced program for annual transfer pricing audits targeting high-risk sectors like agribusiness, extractives, manufacturing, energy and digital services.

    Where aggressive tax avoidance is proven, KHRC insists penalties must go beyond mere recovery of tax and interest to include heavy punitive fines and possible criminal investigations. The commission wants strict restrictions on the deductibility of management fees, marketing fees, royalties and interest on related-party loans unless companies can demonstrate clear economic substance.

    It is also demanding publication of an annual list of the largest corporate taxpayers and companies with major unresolved tax disputes, joint work with the Ministry of Lands to establish a public register linking large landholdings to tax records, and active challenges to treaty shopping and artificial routing of payments through low-tax jurisdictions.

    Most provocatively, KHRC wants companies with histories of aggressive tax avoidance barred from receiving tax incentives, accessing public procurement or benefiting from any form of state support.

    The Del Monte case is not an isolated incident but part of a broader pattern. KHRC’s 2025 publication “Who Owns Kenya?” revealed how corporate tax abuse fuels inequality and leaves essential public services underfunded. The report showed that while multinationals employ armies of accountants and lawyers to minimize their tax bills, schools crumble, hospitals run out of drugs, and roads remain impassable.

    Tax justice campaigners say Kenya loses billions annually to profit shifting by multinationals. A 2024 study estimated that African countries collectively lose around $88.6 billion per year to illicit financial flows, with transfer pricing abuse being a major component. Kenya is believed to lose between $1.1 billion and $1.5 billion annually, though the true figure may be higher given the opacity of multinational operations.

    The global context makes Kenya’s predicament even more galling. Multinationals operating in Africa often pay far lower effective tax rates than their statutory obligations would suggest, using intricate structures involving subsidiaries in places like Mauritius, the Netherlands, Switzerland and the Cayman Islands to minimize their African tax footprint.

    Del Monte Kenya has not publicly commented on the tribunal ruling or indicated whether it will seek further appeals. The company’s managing director Wayne Cook has previously defended the firm’s tax practices as compliant with Kenyan law.

    But the tribunal’s decision suggests that era may be ending. Tax authorities worldwide are cracking down on transfer pricing abuses, and Kenya appears determined to claim its fair share of the wealth generated on its soil.

    For the millions of Kenyans struggling with the rising cost of living, the Del Monte case crystallizes a profound injustice. While they pay tax on every shilling they earn and every item they buy, some of the wealthiest corporations doing business in Kenya deploy sophisticated schemes to avoid contributing their fair share to the country that provides their workers, their infrastructure, their markets and ultimately their profits.

    The question now is whether the Del Monte ruling marks a turning point or remains an isolated victory in a long war against corporate tax abuse. With KHRC and other civil society organizations now turning their spotlight on other multinationals, and with KRA apparently emboldened by its tribunal win, more corporate tax scandals may soon come to light.

    What is certain is that ordinary Kenyans are watching, and they are running out of patience with a system that squeezes the poor while allowing the powerful to game the rules. The Del Monte case has proven that when authorities have the will to act, corporate tax dodgers can be held to account. Now Kenyans want to see that will applied across the board, to every multinational that treats Kenya as a place to extract wealth rather than a country deserving of fair contribution to the common good.

    The KSh1.76 billion Del Monte must now pay is not just a number on a balance sheet. It represents classrooms that can be built, hospitals that can be equipped, roads that can be paved, and services that can be delivered. It represents a small measure of justice in a system that has for too long favored corporate interests over the public good.

    As the tribunal put it bluntly: multinationals cannot use paperwork to export profits when the actual work, risks and value addition happen on Kenyan soil. That principle, if consistently enforced, could transform Kenya’s fiscal landscape and ensure that those who profit from Kenya also contribute to Kenya’s development.

    The battle is far from over, but for once, the people of Kenya can claim a victory.

  • Authorities Launch Investigation Into Massive Smartphone Smuggling Ring at Eldoret Airport

    Authorities Launch Investigation Into Massive Smartphone Smuggling Ring at Eldoret Airport

    Kenya Revenue Authority probes alleged conspiracy to conceal 33,000 high-end phones worth Sh50m in unpaid taxes

    Kenyan authorities are investigating an alleged conspiracy to smuggle 33,000 high-end smartphones through Eldoret International Airport, potentially costing the government Sh50 million in unpaid taxes in what investigators describe as one of the most sophisticated customs evasion schemes uncovered at the facility.

    The investigation, launched following a whistleblower complaint, centers on a consignment that arrived aboard a cargo aircraft from one of Africa’s leading airlines on September 18, 2025.

    Sources familiar with the matter told this publication that the mobile phones were deliberately misdeclared as clothing and household items to evade import duties and value-added tax.

    Kenya Revenue Authority officials, speaking on condition of anonymity due to the ongoing investigation, said the scheme involved “individuals with connections to powerful government figures” and represented a systematic attempt to defraud the state of significant tax revenue.

    “We want all concerned parties to pay attention to this issue now. It’s a serious matter as it is denying the government of much needed money,” said one official aware of the investigation.

    The case has sent ripples through KRA’s enforcement division, with executives reportedly demanding accountability from airport-based customs officials who may have been complicit in facilitating the alleged fraud.

    Investigators have been dispatched to Eldoret to gather evidence and interview relevant personnel.

    This latest incident adds to mounting concerns about tax compliance at Eldoret International Airport, which has emerged as a significant entry point for both legitimate trade and illicit goods.

    The facility has previously featured in customs enforcement actions, with authorities regularly conducting auctions of seized items including smartphones, laptops, and electronic cigarettes whose importers failed to pay applicable duties.

    The timing of the investigation is particularly significant given Health Cabinet Secretary Aden Duale’s recent crackdown on illicit products entering Kenya through various ports of entry.

    In June 2025, Duale presided over the destruction of more than 5.5 tonnes of illegal tobacco products seized at Eldoret Airport, describing such smuggling operations as “instruments of harm” that target young people.

    “Kenya is a signatory to the WHO protocols to eliminate illicit tobacco products. Our enforcement to eliminate illicit tobacco products is a legal and moral duty that must be undertaken,” Duale said during the destruction ceremony at Moi Teaching and Referral Hospital.

    The Health CS subsequently suspended all existing licenses related to nicotine products and warned that the government would not tolerate Kenya becoming “a dumping ground for toxic substances.”

    However, the smartphone smuggling case represents a different category of customs evasion, focused primarily on avoiding tax obligations rather than importing prohibited goods.

    Industry analysts suggest the scale of the alleged operation – involving 33,000 units – indicates a well-organized network with intimate knowledge of customs procedures and potential insider assistance.

    KRA has historically struggled with customs evasion at major ports of entry, with previous cases involving everything from construction materials to consumer electronics.

    The authority’s enforcement efforts have intensified in recent years as the government seeks to boost revenue collection amid growing fiscal pressures.

    The Eldoret investigation comes as Kenya faces mounting scrutiny over tax compliance, with several high-profile cases currently before the courts.

    In April 2025, two contractors were charged with evading Sh290 million in taxes, while other recent cases have involved individuals and companies accused of systematic under-declaration of income and imports.

    Officials at KRA declined to provide official comment on the smartphone case, citing the ongoing investigation. However, sources indicate that the authority is treating the matter as a priority given both the scale of the alleged fraud and concerns about potential corruption within its own ranks.

    The investigation is expected to determine whether customs officials at Eldoret Airport actively facilitated the scheme or were negligent in their duties.

    Early findings could lead to criminal charges against importers, customs brokers, and potentially government officials.

    For Kenya’s tax collection efforts, the case highlights ongoing challenges in monitoring and controlling imports at secondary airports, which may lack the sophisticated scanning equipment and oversight mechanisms deployed at major facilities like Jomo Kenyatta International Airport in Nairobi.

    The outcome of this investigation is likely to influence KRA’s approach to customs enforcement at regional airports and could result in enhanced screening procedures for high-value consumer electronics, which have become increasingly popular targets for customs fraud due to their compact size and high duty rates.

    As the probe continues, it serves as a reminder of the complex challenges facing tax authorities in emerging markets, where sophisticated smuggling operations often exploit gaps in enforcement capacity and, in some cases, benefit from official corruption.

  • Billionaire Narendra Raval Pressures KRA to Waive Sh1.6B Tax Amid Kenya’s Economic Struggles

    Billionaire Narendra Raval Pressures KRA to Waive Sh1.6B Tax Amid Kenya’s Economic Struggles

    As Kenya grapples with mounting public debt and austerity measures, billionaire industrialist Narendra Raval, through his Devki Steel Mills, is locked in a high-stakes legal battle with the Kenya Revenue Authority (KRA) over a disputed Sh1.6 billion tax exemption.

    The case, currently before the High Court in Mombasa, highlights growing tensions between Kenya’s business elite and tax authorities at a time when the country faces significant economic challenges.

    Tax Exemption Controversy

    According to court documents, Devki Steel Mills is seeking to prevent both the KRA and the National Treasury Cabinet Secretary from collecting what the tax authority describes as “Exempted VAT” on plant and machinery imported for the establishment of a major steel factory.

    The dispute centers around a June 2020 undertaking allegedly made by the Treasury, which Devki claims exempted it from paying the VAT on imported equipment.

    The company argues that based on this understanding, it proceeded to clear the imported machinery, establish its factory operations, and has since employed approximately 10,000 workers.

    KRA Pushes Back

    Narendra Raval and President Ruto are seen in State House, Nairobi at a past event.
    Narendra Raval and President Ruto are seen in State House, Nairobi at a past event.

    The KRA, however, contends that the alleged undertaking lacks the signature of the responsible Cabinet Secretary—a critical element for its validity. The tax authority has questioned the legitimacy of the document given the substantial tax amount involved.

    “The absence of the signature raises concerns about the authenticity and legitimacy of the undertaking,” the KRA stated in its court filing, adding that without proper authorization, the understanding “cannot be considered a proper binding commitment.”

    Timeline of Dispute

    The case reveals a complex sequence of events:

    – In June 2020, Devki requested tax exemptions for its major steel project
    – The Treasury allegedly approved the exemption and communicated this to KRA
    – KRA reportedly advised Devki to proceed with releasing the goods VAT-free
    – In August 2024, KRA sent Devki a demand letter for Sh1.3 billion in unpaid VAT
    – By September 2025, the amount had grown to Sh1.6 billion with interest and penalties
    – In October, the Treasury reportedly withdrew its undertaking, claiming no legal provisions supported the exemption

    This dispute comes amid increasing scrutiny of tax exemptions granted to wealthy businesses in Kenya.

    A separate investigation by Parliament is reportedly looking into 14 companies including Raval’s companies that received tax exemptions totaling Sh15 billion.

    Devki’s fears come from recent NCBA precedent, where the bank linked to former President Uhuru Kenyatta’s family, suffered a legal setback after a court ruled that the 2019 tax exemption granted for the merger of NIC Group and Commercial Bank of Africa (CBA) was unconstitutional.

    The exemption, granted by the National Treasury, bypassed legal procedures. During former President Kenyatta’s administration, the Treasury had waived a Sh350 million share transfer tax for the merger.

    The case raises important questions about tax policy consistency, government accountability, and whether large corporations are paying their fair share as ordinary Kenyans struggle with rising living costs.

    Devki’s legal argument hinges on the principle of “legitimate expectation,” claiming that once the exemption was granted and acted upon, the government cannot legally reverse its position.

    For now, the matter remains before the court, with Devki seeking both to block the tax demand and to compel the Treasury to honor what it describes as a binding commitment to settle the tax bill with KRA.

    Economic Context

    This legal battle unfolds against the backdrop of Kenya’s efforts to increase tax revenue collection while simultaneously attracting industrial investment. The Devki steel plant in Kwale County represents a significant industrial development, but critics question whether such tax exemptions create an uneven playing field.

    As this case progresses, it will likely set important precedents regarding the government’s ability to revoke tax exemptions and the obligations of major corporations to contribute to Kenya’s tax base during challenging economic times.

  • How UK Global Tea and Commodities Evades Multibillion Taxes in Kenya

    How UK Global Tea and Commodities Evades Multibillion Taxes in Kenya

    UK Global Tea and Commodities is at the center of a scandal over potential tax evasion in Kenya.

    Allegations have surfaced that the multinational tea trading firm manipulates sales and uses proxy companies to avoid paying billions in taxes.

    The Kenya Revenue Authority (KRA) has accused Global Tea of financial misconduct, leading to a legal battle.

    With high-profile directors involved and a web of complex relationships, this case highlights the darker side of multinational business practices in Kenya.

    UK Global Tea and Commodities

    KRA’s Complicity in UK Global Tea and Commodities Tax Evasion Scandal Uncovered

    The Kenya Revenue Authority (KRA) launched a tax audit on Global Tea’s operations, focusing on transactions from 2015 to 2018.

    On June 8, 2022, KRA issued a shocking tax assessment, demanding Sh1.41 billion, which included corporate taxes, penalties, and interest.

    Global Tea quickly filed an objection on July 8, insisting that KRA had misinterpreted its business operations.

    Despite this objection, KRA reviewed its stance and confirmed the tax amount on September 6, 2022. Feeling aggrieved, Global Tea appealed to the Tax Tribunal on October 19, 2022.

    The company argued that KRA wrongly assumed it was structured to evade taxes, citing significant losses during the audit period as proof of its legitimate operations.

    Issues of Related Parties

    One major point of contention involved the relationship between Global Tea and Tapal Tea Pvt Ltd, a Pakistani company.

    KRA classified both as related parties, suggesting that this connection influenced the transactions and pricing.

    In contrast, Global Tea maintained they operated independently and had a longstanding customer relationship with Tapal.

    Documents from Global Tea indicated that they are a licensed tea buyer and participate in the Mombasa tea auction.

    They purchase tea based on customer specifications, claiming that their business practices align with industry standards.

    Global Tea argued that KRA failed to provide proof that their commission rates were incorrect or that they weren’t operating at arm’s length.

    Evidence Examination and Tribunal’s Ruling

    The Tax Tribunal, chaired by Erick Nyongesa, reviewed the case thoroughly. They focused on three main issues: whether Global Tea and Tapal are related enterprises, whether their transactions were controlled, and if KRA’s methodology for determining prices was justified.

    The tribunal found that KRA had conducted investigations based on perceived inconsistencies between Global Tea’s profit level and its operational scale.

    They noted that while Global Tea confirmed links to various other companies, they strongly denied any ties to Tapal Tea Pvt Ltd.

    Next Steps for Global Tea

    As the tribunal deliberated, tensions continued to rise. Global Tea insisted that their operations, including their commission structure, were above board. They argued that KRA focused on inventory discrepancies rather than genuine tax fraud.

    The court’s decision highlighted the need for KRA to demonstrate that it had conducted a thorough examination of Global Tea’s financial dealings.

    KRA, for its part, had used industry benchmarks to validate its tax calculations. With the outcome still pending, Global Tea faced an uncertain future.

    This case serves as a critical reminder of the complexities multinational companies navigate in compliance with local laws.

    Whether Global Tea can successfully defend against KRA’s substantial claims remains to be seen.

    In conclusion, this controversy shines a light on the intricate relationship between international businesses and tax compliance in Kenya.

    As investigations unfold, both KRA and Global Tea must clarify their positions to restore integrity and trust in the taxation process.

     

  • Ex-LSK President Havi Accuses NCBA Bank Of Disclosing Client’s Bank Account Details To KRA In Alleged Breach Of Trust Act Violation In Tax Row With KRA

    Ex-LSK President Havi Accuses NCBA Bank Of Disclosing Client’s Bank Account Details To KRA In Alleged Breach Of Trust Act Violation In Tax Row With KRA

    The former President of the Law Society of Kenya (LSK) Nelson Havi is currently embroiled in what he promises to be a wounding war with the Kenya Revenue Authority (KRA) over alleged tax evasion and which has also scandalized NCBA Bank.

    Mr. Havi is accusing the bank which is liked to the former president of Kenya Uhuru Kenyatta for using the privilege to what he claims to be a witch-hunt.

    “KRA is the most abused state agency. In April, 2022 Uhuru Kenyatta saddled me with a tax demand of Kshs 92M effectively designating me a billionaire. Our friends have found it fit to use it on me. As a billionaire, I will fight and win. It will be a precedent setting litigation.” He says in a statement.

    Below are the statements and demands sent to the lawyer from KRA.

    In an explosive affidavit filed by the lawyer in appealing the tax demand, he claims that the offivers in question revealed to him that he was a victim of state witch-hunting owing to his hard stance on president Uhuru’s administration.

    “In the meeting of 10″ September, 2024 I put the two officers of the Respondent I met up with, Anthony Ongondi and Kathure Kamunde to disclose to me who was behind my tax woes. One of them, Anthony Ongondi told me that the investigations were commenced pursuant to an order from State House and that I should not blame them as they were only doing their work.” He states in the affidavit seen by Kenya Insights.

    Havi further notes that his word didn’t stop with the reign of Uhuru who exited power in 2022. “I asked Anthony Ongondi why my woes continue despite President Uhuru Kenyatta having left office two years ago. He told me, “KRA is at the disposal of all Governments to deal with troublesome people and the current administration is not an exception.” I got the message, loud and clear.” He states.

    Case against NCBA Bank

    Mr. Havi has particularly taken case against Kenyatta’s owned NCBA Bank of privacy breach by allowing the state to use his client’s private information to fight what her terms a political war.

    “Between 2020 to 2022 the Respondent abused the tax collection power at the behest of President Uhuru Kenyatta to unlawfully access my client account operated at NCBA Bank which Bank is associated with President Uhuru Kenyatta in the pursuit of interests unrelated to the collection of tax, but to curtail me in my practice as an Advocate, and in my capacity as President of the Law Society of Kenya from holding the Government of Uhuru Kenyatta accountable.” He states in a statement seen by Kenya Insights.

    Mr. Havi further claims that despite complying with tax collector’s requirements, KRA denied him the Tax Compliance Certificate for 2020 under the instructions of President Uhuru.

    “The Respondent refused to issue me with a Tax Compliance Certificate for 2020 in a nefarious enterprise set up by officers of the Respondent at the instance of President Uhuru Kenyatta. These are the officers involved in the tax investigations and demands to me. Their names appear in the emails and letters from the Respondent.”

    In his affidavit, Mr. Havi claims he had complied to all tax returns and had been supplied with the compliance certificate before the 2020 debacle.

    “The Respondent issued me with Tax Compliance Certificate for all years subsequent to 2021, a confirmation that I was not indebted to the Respondent on any outstanding tax. Exhibited at pages 19 to 21 of NAH-1 are Tax Compliance Certificates for 2021, 2022, 2023 and 2024.” He says in his statement to argue his innocence.

    Mr. Havi says the frustrations from KRA and particularly from deposits to his client’s accounts at NCBA Bank cost him many other jobs.

    “In June, 2020 I applied for a Tax Compliance Certificate to enable me tender for the provision of legal services to several entities including but not limited to Safaricom Limited, Turkana County and Narok County who were my key corporate clients at all material times.”

    Still, in his affidavit, Havi indicated that the monies the KRA have been running after were not income to attract any tax. Some of the funds were costs from court cases, others were purchases of properties, which cannot be taxed. He instanced receipt of monies from a client after representing them in an electoral petition in 2013; the monies were the costs of the case which ought not to have been taxed or charged VAT.

    “The sum of KSh 1,000,000.00 received on March 3, 2017 from Gumbo and Associates are the costs awarded to the Petitioner in Election Petition No 4 of 2013, Esther Chege Waithera v IEBC and Others. It is not fees or any other income. Costs due to a party in litigation do not attract income tax or VAT chargeable on the Advocate,” read his document partly.

    Mr. Havi at his time was a staunch critic of the BBI which was a spring project of Uhuru and Raila.

    Havi said the BBI bill had sought to interfere with the independence of the Judiciary with installation of the Ombudsman to perform functions allocated to JSC.

    “The culture of impunity in Kenya needs a fix tool. IEBC must do its job and Parliament do it and the court do its job, I plead to dismiss the four appeals and affirm the decision made by the High Court,” Havi said at the time.

    NCBA and breach of privacy

    The bank has recently been having a rough ride with authorities over breach of contract with customers.

    NCBA Bank hawa recently ordered to pay United Kingdom based solicitor Sh250,000 for disclosing her data to a third party.

    Data commissioner Immaculate Kassait slapped the lender with the fine as compensation to the Kenyan and UK-based solicitor Rose Wambui Muigai.

    The ODPP noted that the lender failed to process personal data in accordance with the right to privacy resulting in unlawful and unauthorized disclosure of Muigai’s personal data.

    Last week, one of the bank’s Manager’s Phillip Kiprono Rotich was detained at Kileleshwa Police Station for allegedly stealing millions of money from a Catholic Church Account domiciled at the Bank.

    He was arraigned at Milimani Law Courts in Nairobi where the DCI, Banking Fraud Unit sought an order to detain him for 10 days to complete investigations and prefer charges.

    The court heard that he was being investigated for various offences, including conspiracy to commit felony, forgery, uttering false document, stealing and possession of proceeds of Crime as reported by NCBA Bank of Kenya.

    According to the Bank, Rotich used his position in the bank orchestrated a fraud by using advantage bestowed to him by the Bank’s clients and a fraud that led to the loss of over Ksh 47 million.

  • Businesses Shun KRA’s eTIMS System

    Businesses Shun KRA’s eTIMS System

    The Kenya Revenue Authority (KRA) gave March 31, 2024 for all businesses to on-board the eTIMS system for easy verification of transaction records and specifically proof of client invoicing.

    Initially, KRA had envisaged registering a total of over 900, 000 recognised businesses, a figure they had derived from their own records.

    However, when the deadline hit, to the surprise of KRA only 49% of the registered 236,000 businesses oN the eTIMS system were actively using it. The Kenya National Bureau of Statistics (KNBS) however states in its records that over 7 million businesses existed within the country within the past year.

    KRA, through its electronic tax invoice management chief manager, Hakamba Wangwe, now says that among its options, penalties would be meted out to ensure compliance. What is baffling, however, is that Wangwe also claims that many businesses are still onboarding eTIMS by using the USSD code, the Web application on eCitizen and a newly introduced mobile app on playstore as the big VAT registered businesses remain domiciled on the eTIMS platform, even though they fail to activate usage if the system.

    In 2023, KRA had stated that every business in the country was expected to invoice at all transactions through the eTIMS from 1st April 2024 after having postponed the same from 1st January 2024. The tax authority now says it is keen to monitor all these recorded transactions for a better visibility of VAT claims by the concerned businesses.

    The tax authority, in a bid to widen the tax net, has also tried roping-in farmers, so far unsuccessfully, as political heat spilled out of control since KRA officials’ visit to avocado farmers earlier this year.

    The Tax authority says they are still in talks with all cadres within the farming fraternity and beyond to get all Kenyans to pay taxes.

    Why businesses are not boarding

    However, most businesses are yet to on-board. There are a number of reasons that they say are beyond their control.

    Virginia, who sells locally manufactured hardware goods says she trades with a majority of other businesses who are not on-boarded as yet. There are other traders who complain on the number of things required to register one-self on the eTIMS platform.

    Recently, when making a purchase from a second hand car dealer from a very tiny shop, situated within a corridor, at the back of Kirinyaga street, I heard the shopkeeper turn down a generous order from a fellow trader because he insisted he could not generate an eTIM invoice. He had not on-boarded because they were asking for so many things and his level of knowledge was not much help.

    Julius, a small trader who runs an eatery attached to a green grocery kiosk known locally as “kibandasky.” His joint is frequented by informal sector workers deep in Kangemi area. At a recent meeting, he was at pains describing how the eTIMS system is a micromanagement of their businesses and he does not see in it any particular benefit for his small business, so he has not on-boarded.

    If anything he says he would have to employ someone extra to ensure he generates invoices whenever he makes a sale to other traders selling further afield so it adds a cost to his small business which he cannot absorb.

    I spoke to a doctor who said he simply cannot onboard the system. He says the eTIMS system expects that every consultation registered at his clinic equals money having been paid yet that is not always the case as not all clients pay promptly and others end up not paying at all! They have raised the issue through their medical professional organization and hope an amicable solution will soon be reached.

    Elephant in KRA’s room

    The real work still remains with KRA, to not only carry out more advocacy on the role of every citizen in supporting the state in delivering important common services but also in ensuring that the large population yet to get into the tax bracket are given a reason to be proud of paying their taxes.

    The urban Kenyans are ever suspicious that their hard earned money is what they see every other day embezzled by well-placed government officials while those on far flung places in the corners of the country still feel they are marginalized and neglected, so why support negligence, despite the advent of devolution.

    Many people in the country are still unaware of the concept of paying tax beyond what they pay the county government at the local livestock market when they sell their cattle to take their children to school. The KRA needs to connect more with the citizenry from the highest to the lowest in society in its collection of taxes, and it should avoid coercing them in a bid to making them comply.

    Many Kenyans still need more tax education, better tax facilitation and above all a tax system that is averse to punishment when seeking tax compliance but look for innovative ways to nudge Kenyans to pay tax for realistic and better services and enrich their lives.

    There are those sophisticated tax cheats who owe millions of billions in taxes, fines and prosecution should be directed towards them even as first time small tax payers are facilitated and celebrated for their baby steps.

  • Businesswoman Behind Contaminated Imported Sugar Seized In Mombasa

    Businesswoman Behind Contaminated Imported Sugar Seized In Mombasa

    The seized sugar at a private container freight station, Mitchel Cotts, was imported from Port Louis, Mauritius by Rehema Badi, a marketing strategist at Mitchell Cotts which is under Elavon Logistics Limited.

    Word has it that Rehema is a notorious businesswoman used by local and international sugar cartels to dump contaminated sugar in the country. She operates offshore bank accounts where her cut is banked.

    It’s alleged that that powerful sugar barons use Rehema to import the contaminated sugar, powder milk, rice and other imports.
    Daniel Tanui is the group managing director at Mitchell Cotts Group.

    According to Kenya Ports Authority and Kenya Revenue Authority documents, Elavon Logistics Limited situated on Nyali Links Road imported the sugar late last year on bill of landing number MEDUPL346582.

    Police seized more than 1,112 metric tonnes of contaminated sugar in Mombasa worth Sh214 million that was about to be released into the market and to the public.

    The insurer of the shipper compensated the importer and the said sugar was to be destroyed upon the ship docking at the port of Mombasa.
    The same was shipped by the Mediterranean Shipping Line and alleged to have drenched in water in the high seas.

    However, the importer allegedly corrupted and bribed KPA and other agency officials who were to ensure the sugar was destroyed. It is said Rehema held meetings with KPA and KRA officials at Nyali Mall where the deal was struck and money running into millions of shillings was agreed upon to facilitate the deal.

    Rehema was allowed to offload the contaminated sugar taking it to Mitchel Cotts CFC where she untouchable.

    Upon seizure, the importer had made the declaration on February 9 2024 where Sh30 million was paid to customs and Sh6 million was paid to Kenya Bureau of Standards to process the release of the entire consignment into the market.

    A letter from The Food, Drugs, and Chemical Substance Act (Cap. 254) Seizure Form B dated February 2 2024 indicated that the entire consignment had been seized, thus saving Kenyans from consuming the contaminated sugar.

    Many questions are however being asked over who allowed the importer to offload sugar that was to be destroyed and who allowed a bad consignment to be released in a private cargo facility charge where the importer is an employee?

    Officials at owned Mitchell Cotts CFS in Mombasa were caught with their pants down, and are now engaged in damage control. They now claim that the alleged 780.2 metric tonnes of contaminated sugar stored at the station was not released into the local market.

    Mitchell Cotts CFS director in charge of operations James Rariaya said samples have been taken for laboratory and quality assurance testing by Kebs and that no sugar has been released for consumption. Sources say that Rariaya was part of the deal that also involve powerful political wheelerdealers in Nairobi and Mombasa.

    It was shipped into the country, inside 46 20-foot containers, aboard the container carrier MSC Eagle F.

    The ship partially sank for over 24 hours outside the Kilindini channel. Several containers were thus affected by water seepage.

    However, last week, it emerged that there was an attempt to release the cargo into the market, despite a seizure order from the government agencies. Rehema was making calls, threatening those blocking the cargo release.

    Caught in the mix is Rehema buddy at KRA Swaleh Teher, chief manager of port operations. Word has it that Teher does not get on well with George Aduwi, manager at the ICDN and Jane Ombui of revenue monitoring unit.

    During the clearing process, Rehema and Teher dropped the name of KRA board chairman Anthony Mwaura.

  • Supa Loaf Bread Owners Exposed

    Supa Loaf Bread Owners Exposed

    They carry themselves as manufacturers and distributors of baked goods throughout Kenya and lately Tanzania and Uganda. But behind the scenes are underground operations involving tax evasion running into billions of shillings in East Africa. Mini Bakers owners have invested in bakery production of Supa loaf and Akiyda. They are also in fertiliser production and real estate investment. Weekly Citizen exposed the operations of directors led by Wasmin Manji who has political connections and ventures in sugar industry. The family is said to have celebrated when tycoon Jaswant Rai fell out with the establishment.

    Mini Bakeries, the company behind the Supa Loaf brand is involved in a tax evasion scandal through planned inside theft with the full knowledge of top managers and directors.

    Kenya Revenue Authority is losing billions of shillings in the syndicate according to an insider well versed with the happenings.

    The manufacture and distribution of baked goods is done throughout Kenya, and more recently than never before, in neighbouring Tanzania and Uganda undetected.

    The management of the bakeries have perfected the art and gimmicks of inside theft just as banks do inside trading, and sneak over one million loaves of bread to the market to evade paying taxes.

    According to impeccable sources, over 100,000 loaves of bread are sneaked into the market on a weekly basis, thus denying the taxman millions of shillings that would otherwise help in resuscitating the ailing economy.

    The source confided that once noticed by relevant authorities, the management decides to implicate staff in theft of bread landing them in court on several occasions. The court is a coverup deal to show the taxman, goods were stolen hence cannot be taxed. Many of the said cases end up being withdrawn by the complainants with the so said stolen bread finding itself among distributors who pay Mini Bakeries at normal rate but not captured in KRA documents.

    One case is that of Ali Omar Faraj, who was employed by Mini Bakeries (MSA) Limited as a trainee manager, with effect from June 1 2007, with a starting with a gross salary of Sh18, 000 per month.

    In the course of time, Faraj rose through the ranks to become the manager at Likoni branch, earning a gross monthly salary of Sh70, 000. He was, however, suspended on December 4 2013, after a senior production manager visited and found some loaves of bread were not up to the set standards of production as they were underweight.

    Following that discovery, a stock-taking exercise was done which revealed that 185 loaves of bread were also missing.

    Although Faraj was surcharged for the said loss, what broke the camel’s back was the fact that during his suspension, further stocktaking was done and it was found that a further 300 loaves of bread were missing.

    The letter of summary dismissal is dated December 19 2013 the effective date of dismissal was stated to be December 20 2013.

    The matter landed in court and Mini Bakeries was ordered to pay Faraj the equivalent of six and a half month salary in compensation for unfair termination pegged at Sh455, 000, and one month salary in lieu of notice at Sh70,000 totaling to Sh525, 000. Insiders say that the payment was just a tip of the iceberg since Faraj had for years helped the company evade taxes in form of stolen bread.

    That the multibillions bread manufacturer working conditions are poor is no secret.

    In the High Court, Kakamega Civil Appeal No 96 of 2017, Mini Bakeries appealed against a ruling the bakery and Levi Kariz Oriedo.

    Oriedo was employed by the firm and was assigned duties without due care and attention, failing to take any precautions for the safety of the employee. The company failed to provide a safe place of work, failing to provide necessary tools, among others.

    On April 21 2017, the parties entered into a consent on liability at 80:20, whose effect was that the company conceded that Oriedo was its employee.

    Another court case study is Employment and Labour Relation Court of Kenya at Kericho Cause No 185 of 2915 between Peter Odhiambo Angira (claimant) and Mini Bakeries (respondent) this matter is originated by a memorandum of claim dated July 9 2015. The issues for determination as set out there in are; whether the claimant was unlawfully, unprocedurally and unfairly terminated from employment by the respondent. The claimant’s case is that at all material times to this suit, he was employed by the respondent as an oven man with effect from November 1 2011. He worked hard and was promoted and as a result he was promoted to be in charge of hand bakers and transferred to work in a bakery that transported bread where he served until the date of his unfair and unprocedural termination. At the time of termination, he earned Sh13,556.

    It is the claimant’s further case that his employment was terminated unprocedurally and without lawful cause on the grounds of absenteeism which was not true.

    The court ruled that Angira was an employee of the Mini Bakeries. The second issue for determination was whether the termination of the employment of the claimant by the respondent was wrongful, unfair and unlawful.

    The court found Mini Bakeries had wrongfuly, unfairly and unlawfully terminated the employment of Angira.

    The third issue for determination was whether the claimant was entitled to the relief sought. Having succeeded on issues No 1 and 2 above the court ruled, Angira was entitled to the relief sought.

    Mini Bakeries has directly and indirectly employed over 3000 people including bicycle vendors and distributors who in turn employ others to deliver Supa Loaf to over 20,000 retail outlets within Kenya, Tanzania and Uganda.

    Mini Bakeries sells over three billion slices of Supa Loaf or over 200 million loaves of bread every year, potentially putting its annual revenue at over Sh6 billion.

    Mini Bakeries was established by Nurzakhanu Akberali Manji and her husband Akberali Manji, and has over several decades grown to become one of the largest companies in the food and beverages sector.

    Nurzakhanu Akberali Manji, nicknamed Mama Kubwa and her three sons are the ones steering the business from a household bakery to a multibillions family empire. They are also linked to feterliser company in Tanzania and Aquava Agencies in Kisumu.

    The also own Island Paradise Inn, Akiyda Bakeries and Butali Sugar Mills. It is due to these tax evasion gimmicks that saw the bakery appeal at Uganda court ruled in favour of Uganda Revenue Authority in Application No 102 of 2018 in the Tax Appeals Tribunal at Kambala.

    The ruling was in respect of an application challenging a penal tax assessment of Sh52,881,046 for underestimating provisional tax for the period 2017 to 2018.

    On the December 17 2017, Mini Bakeries applicant filed a provisional income tax return for the period 2017/2018 with an estimated tax liability of Sh311,446,187. On the June 25 2018, the

    applicant filed an amended provisional income tax return of Sh450,000,000 as an estimated tax liability. On December 7 2018, the applicant filed its final income declaring a tax liability of Sh793,783,590.

    Upon submission of the final return Uganda Revenue Authority issued a penal tax assessment of Sh 52,881,046.

    It was noted that it was not in dispute that the gross turnover declared by Mini Bakeries in its revised provisional tax assessment was less than 90pc of that declared in the final return.

    It was clear that the amount estimated in the provisional returns were 56pc which is less than the required 90pc by law.

    The court ruled that Uganda Revenue Authority was justified to impose penal tax. Mini Bakeries is also being accused of swindling innocent members of public millions of shilling when it ventured into real estate with plans to build a Sh3.5 billion residential estate off Kamiti Road in Kiambu county which has become a white elephant project.

    Mini Bakeries sought to exploit the growing demand for housing in Nairobi metropolis and cut reliance on revenue from bread.

    Wasmin is said to have pocketed KRA officers working under Commisioner General Hamprey Watanga Mulongo.Mulongo has been petitioned to investigate.

  • Court Upholds Sh20M Tax Fraud Demand By KRA Against Singapore Motors

    Court Upholds Sh20M Tax Fraud Demand By KRA Against Singapore Motors

    A motor vehicle dealer has lost a petition seeking to quash a Sh20 million tax demand by the Kenya Revenue Authority (KRA).

    Singapore Motors, which deals with imported cars from Japan suffered a blow after the High Court dismissed the petition.

    The court found that the company failed to file tax returns as required by the law and did not pay taxes in the period stated by the taxman.

    “The court has established that the Appellant failed in his obligation to file tax returns as stipulated under section 52B of the Income Tax Act. He also did not pay taxes during that period,” said the Judge while dismissing the application

    KRA said it did a tax assessment of the company and issued a notice of Sh99,960,19 in a letter dated 24th April 2019. The amount included income tax, penalties and interest.

    The company challenged the taxman’s decision before Tax Tribunal but the same was dismissed.

    The Tax Tribunal upheld KRA’s decision a move that forced the company through its director Michael Ndichu Mburu to file an appeal before the High Court.

  • Experts question KRA’s plan for 50pc tax appeal deposit

    Experts question KRA’s plan for 50pc tax appeal deposit

    Tax experts have poked holes on the proposal by Kenya Revenue Autority (KRA) that will require firms and individuals to deposit half of tax demands before escalating the dispute from the appeals tribunal to the High Court.

    They raised constitutional questions arguing that passing the proposed changes to the Tax Appeals Tribunal Act will deny taxpayers who are unable to raise 50% of the disputed taxes the right of appeal, which is against Section 50 of the Constitution.

    At the moment it is upon the courts to determine whether KRA’s demands for security are justifiable before they set the amount to be used as a deposit or bank guarantee.

    The proposed changes were by backed by Treasury Cabinet Secretary Ukur Yatani who said the proposals were aimed at encouraging out-of-court settlements to ensure quick resolution of cases in a bid to unlock billions of shillings tied in legal processes for years.

    “If I don’t have that amount of money, it means I cannot even appeal and, under the law, I have to appeal within 30 days ….So if I don’t appeal within 30 days, I no longer have that right of appeal, and from a constitutional perspective, that’s a very bad provision.” said Robert Waruiru, an associate director for KPMG Advisory Services.

    If the proposal sails through then Kenya will join countries as Ghana where the deposit is 30% of the assets assessed before the appeal and Tanzania where there’s no option to object the High court.

    KRA’s Deputy Commissioner for corporate policy Maurice Oray, who sits at the budget committee also defended the proposal arguing that it resulted from analysis of trends in tax arbitration processes that take as long as 20 years and therefore will save for the government and taxpayers.

    “It looks a bit punitive, but let us look deeper into the issue. At the end of it, the interest (on disputed taxes) is capped and so the government cannot collect more than 100% what’s payable,” Oray said.

    KRA’s Tax Dispute Resolution (ADR) mechanism, which must be concluded within three months, is the first layer of resolving disputes arising from tax audits before they are escalated to the Tax Appeals Tribunal and to the courts.

    Kenya used to have the same provisions under the VAT Act as well as Customs and Excise Act where the deposit was 30% of disputed taxes.

    The proposal further suggests that taxpayers will be refunded the deposit within 30 days if they win the appeal.

  • KRA Accuses Keroche Of Dishonesty In Tax Row

    KRA Accuses Keroche Of Dishonesty In Tax Row

    The Kenya Revenue Authority (KRA) has come out to blame Keroche Breweries Limited for its failure to honour payment agreements involving billions of shillings in acrued taxes.

    KRA on Tuesday said the Naivasha-based brewer has consistently failed to honour agreements reached between the two parties leading to the closure of its premises since February 1, 2022.

    According to the taxman, KBL has been consistently collecting excise duty taxes levied on its alcoholic beverages without remitting it to the authority.

    At the centre of the 15-years dispute is the Kshs. 351 million KRA says the brewer owes and which KBL says amounts to Kshs. 322 million contradicting the authority’s figure which led to closure of its premises.

    “On the issue relating to Kshs. 351 million taxes due and prominently highlighted by Keroche Breweries Ltd as being the main reason that led to the recent closure of the premises, it is imperative to note that this is principal tax which Keroche withheld for the period January 2021 to date and has not remitted the same to KRA. This means that Keroche Breweries Ltd has been collecting Excise Duty Tax and VAT from its consumers through the sale of its products but has not been remitting the taxes to KRA,” said KRA.

    KRA says, by December 14, 2021, this amount stood at Kshs. 279.96 million which Keroche offered to pay in instalments of Kshs. 20 million beginning January until October 2022.

    Subsequntly, the brewer also agreed to pay another Kshs. 30 million in November and 49.96 million in December to clear the tax arrears.

    Howevever, KRA says Keroche only paid Kshs. 10 million and dishonoured the agreement.

    On her part, KBL Chief Executive Officer Tabitha Karanja on her official Twitter handle blamed KRA for frequent closure of its bremises in a bid to recover pending taxes.

    “On 22nd December 2021 KRA re-opened, but unfortunately, the earliest our products could reach the market was on 27th December 2021. We only managed to sell for three days till the end of the year but KRA were on our case demanding for the arrears according to the payment plan. We remitted Kshs. 10 Million which was available in our accounts then, which to them was insufficient,” said Tabitha.

    KRA now accuses KBL of mischief in honouring the tax obligations which the firm assessed and declared on its own in its monthly returns but but did not remitt.

    “It can only mean that the Taxpayer may be using taxes collected to fund the company’s operations or for other private purposes,” said KRA.

    The authority further accuses the brewer of not honouring payment plans agreed with the Keroche on current taxes and the taxes agreed under the Alternative Dispute Resolution process.

    KRA adds, “The first plan agreed in July 2021 was not honoured, the second plan agreed on in December 2021 was also not honoured. Further in January 2022 Keroche requested for a review of the plan and the same was granted again in writing but still Not Honoured.”

    Following push and pull involving courts, ADR and Tax Appeals Tribunal, KRA and KBL had agreed in December last year on a Ksh. 7.5 billion tax owing and payable, comprising principal tax of Kshs. 4.5 billion, penalty of Ksh. 66.9 million and interest of Kshs. 2.98 billion.

    Keroche Breweries has since applied to the National Treasury seeking abandonment of taxes amounting to Kshs. 3.9 billion.

  • KRA Axes 20 Clearing And Forwarding Firms Engaging In Counterfeit Goods And Tax Evasion

    KRA Axes 20 Clearing And Forwarding Firms Engaging In Counterfeit Goods And Tax Evasion

    The Kenya Revenue Authority (KRA) has flagged the operations of 20 clearing and forwarding agents based at the Port of Mombasa, setting them up for tighter scrutiny as it moves in to net tax cheats.

    KRA deputy commissioner for Revenue J Kaguru says in a letter dated November 11 that the firms were found to have ‘non-compliance issues’ after several risk analyses.

    The clearing and forwarding agents include Regal Freighters, Delta Express, Subukia Holdings, Greentop Logistics, Zanaa Freights, Riam Logistics as well as Utmost Freight Matters Limited.

    Others are Ozone Freight Forwarders Limited, Adelcus Agencies, Wiljones Logistics, Venues Kenya Limited and Neline Shipping and Logistics Enterprises.

    “The attached list of 20 clearing agents have been found to have compliance issues, after several risk analysis. All consignments declared by the clearing agents in the list to be considered as high risk,” said Mr Kaguru in the letter. KRA red lists entities that it finds to have higher tax risks.

    The taxman further stated that going forward, and from the date of the issuance of the memo all kitenge and textile materials must be verified 100 percent, all photos taken and attached in the system.

    The taxman, currently racing to bring more people into the tax bracket and curb tax cheating in the quest to meet targets, says that to enhance compliance, long room pass will be issued upon review by HDO officers on duty.

    All cargo release at station level must also be approved online by the station managers.

    Station managers must also be enjoined and given online approval before release of the consignments.

    “The purpose of this communication therefore, is to request Document Process Centers, National Targeting Centers and the release stations to make appropriate arrangements to comply,” he says.

    According to the KRA’s communication, the black listed firms have been engaged in the importation of counterfeit, poor quality goods prompting the crackdown.

    African wax print fabric commonly known as ‘Kitenge’ will now undergo 100 percent verification in stringent measures by the taxman aimed at subjecting importers to tighter checks in a race to seal tax leakages.

    The Kenya Revenue Authority (KRA) says in a memo dated November 11 that the checks would ascertain the description, quality and quantity of the fabric to allow for proper valuation.

    “Going forward, from the date of this memo, it is now expected that clearance of Kitenge and textile materials to be verified 100 percent and photos to be taken and attached in the system,” says the KRA in the memo.

    The development is set to delay the clearance of the fabric, which is gaining traction in the region. Importers have been using arbitrary values when declaring Kitenge at the port of entry, which appears to disregard the quality of the fabric.

    Some importers have also been using generic description — “textile materials” — or falsely declaring their goods as mixed fabrics to avoid paying the requisite duty for full container loads of Kitenge.

    But to seal the loopholes, KRA says all imported consignments described as “textile materials” should also be subjected to physical verification before releasing at the places of discharge.

    Such consignments, the taxman says, should be excluded from the “Port Clearance Model”, which allows release without physical verification.

    “To avert the release of the many pending consignments of Kitenge or textile materials, without proper verification, about 60 containerised cargo will now be subjected to close monitoring before entry,” says the KRA.

    The taxman is subjecting Kitenge and other textile materials to tighter checks barely a day after it flagged the operations of 20 clearing and forwarding agents based at the Mombasa port.

    The firms were found to have “non-compliance issues” after several risk analyses.

    The KRA has been intensifying its crackdown on tax cheats using various databases, including bank statements, import records, Kenya Power records, motor vehicle registration details, water bills and data from the Kenya Civil Aviation Authority, which reveals individuals who own assets such as aircraft.

    The taxman has in the past two years also been seeking details of suppliers and contractors hired by county governments.

    This followed a steep increase in imports of the luxury goods and multi-million-shilling investments in real estate — an indication that some crooks could be evading payment of tax.

    Last week, KRA commissioner-general Githii Mburu said his officers are now spending time on social media, trolling Kenyans posting photos of luxury cars, throwing expensive parties, living lavishly to ensure their taxes are in tandem with their image.

    The taxman wants socialites and individuals who display lavish lifestyles on the interwebs to pay their fair share of taxes as it races to bring more people into the tax bracket.

  • Collapsing Mulleys Supermarket Under Probe For Tax Evasion

    Collapsing Mulleys Supermarket Under Probe For Tax Evasion

    Mulleys Supermarket in Machakos County is in the eye of a storm over alleged widespread tax evasion fraud claims. On Friday last week, the retailer closed down its branch situated at the Machakos bus stage in an effort to ward off the instigators from accessing their books of accounts.

    The pioneer locally owned supermarket in Machakos was at one time one of the fastest-growing retailers in the region but seems to have fallen back on tax returns, sources have revealed. Top KRA investigators have been tasked to probe the chain’s weekly returns at a local bank.

    KRA Investigators are said to have unearthed a massive tax evasion racket at the supermarket

    The supermarket is conveniently located opposite the said bank on the way to Machakos town center. According to sources, KRA is probing claims that senior managers at the bank are involved in a massive cover-up in the tax evasion racket. KRA Anti-fraud unit and ICT experts are also investigating a senior Nairobi based auditor who has been blacklisted as a “tax scammer” aiding several firms to evade paying taxes.

    The retailer operates another branch at Mulolongo and is said to owe KRA up to Kshs 300 million in taxes during the period of 2019-2021. The supermarket stocks goods ranging from home furniture, Electronics, Home appliances, Clothes, Home crafts, Farm fresh, Home use products, wines and spirits products.

    The supermarket also retails all basic essential commodities like maize flour, milk, bread, snacks, and domestic cutlery.

    In the latest development, Mulleys Supermarket has announced the closure of five of its 10 branches, in a shock downsizing plan that has seen hundreds of staff laid off.

    The supermarket which had presence in four counties of Nairobi, Machakos, Kitui and Makueni shut down half of its branch network as it struggled to stay afloat amid mounting debts and empty shelves.

    In an ambitious expansion programme that may have gone wrong, the supermarket closed two of its main branches in Machakos town – Mulleys Express near Machakos bus station and Mulleys Pioneer situated opposite Machakos General Hospital.

    Also affected were the Mulleys Kitui branch, Mulleys Highway in Mlolongo market and Mulleys Tala branch.

    According to a notice posted at the entrances of the closed outlets, the supermarket management said their business was undergoing a necessary restructuring and reorganisation process.

    DEBT BURDEN

    “We highly regret all the inconveniences caused by this occurrence but do kindly request you bear with us. We shall keep you updated on new developments along the way” read the notice.

    The management announced that its operations will continue in Mulleys Embakasi in Nairobi, Mulleys Mtaani in Mlolongo, Mulleys Masaa in Machakos, Mulleys Jibambe in Tala and Mulleys Emali in Makueni County.

    Signs that the debt-ridden retail chain was struggling with possible cash flow problems became evident six months ago when their shelves became empty.

  • KRA Is Now Keeping An Eye On Kenyans Displaying Lavish Lifestyle On Social Media To Nab Tax Cheats

    KRA Is Now Keeping An Eye On Kenyans Displaying Lavish Lifestyle On Social Media To Nab Tax Cheats

    The taxman is training its guns on rich Kenyans displaying lavish lifestyles on social media but paying little or no taxes.

    The Kenya Revenue Authority (KRA) Commissioner-General Githii Mburu said his officers are now spending time on social media, trolling Kenyans posting photos of luxurious cars, throwing expensive parties, living lavishly to ensure their taxes are in tandem with their image.

    In a move that is set to strike at the heart of the ‘soft life’ generation, socialites and a growing number of Kenyans who are splashing their lives on social media, the KRA says it is time for every Kenyan to pay their fair share of taxes.

    The tax cheats risk travel bans, collection of duty directly from their suppliers and bankers and prosecution in what is emerging to be the biggest crackdown yet on high-net-worth individuals.

    The KRA is racing to bring more people into the tax bracket and curb tax cheating and evasion in the quest to meet targets.

    The taxman has a team focused on smoking out tax cheats through sites such as Facebook, Instagram and Snapchat.

    “In the social media, we have some people posting some nice things. You would see some posting nice houses, cars, taking their families to nice places and so on. Here, we are not sleeping, when we see those, we see taxes,” Mr Mburu said in an interview with the Business Daily.

    The KRA chief said seeing a fuel guzzler zoom past him, he asks himself if that man or woman behind the wheels has paid taxes.

    “We have our officers looking, they have gadgets. They key in very quickly (the number plate) to check. We are working exceptionally hard,” he said.

    He said this could explain in part the reason for his success, having exceeded his tax collections target for this year by Sh27 billion.

    The clampdown on the rich is part of the commitment that Kenya made to the International Monetary Fund (IMF) to recover unpaid taxes from high-net worth professionals and traders in efforts to raise the national revenues.

    The KRA is flagging wealthy individuals that have been hiding their sources of income while engaging in luxury spending and accumulation of property, including purchase of homes and big cars.

    Besides scouring social media sites, the Authority has been using various databases to pursue suspected tax cheats, among them bank statements, import records, motor vehicle registration details, Kenya Power records, water bills and data from the Kenya Civil Aviation Authority (KCCA), which reveal individuals who own assets such as helicopters.

    Mr Mburu says a huge chunk of Kenyans building houses are not paying taxes on claims the properties are products of bank loans.

    “We know you can build a house from loans. But that loan must be repaid from somewhere. We are following all those applying for meters”.

    The KRA is also linked to the government’s e-procurement system or the Integrated Financial Management Information System (IFMIS), making it easier to pursue suppliers earning billions of shillings from counties and State tenders without paying their share of taxes.

    “We have access to IFMIS and we want to see anyone being paid by government; is he or that business paying taxes? We are also able to work with other third parties like Kenya Power,” Mr Mburu said.

    Kenya Power meter registrations are helping the taxman to identify landlords, some of who have been slapped with huge tax demands.

    Car registration details are also being used to smoke out individuals who have little to show in terms of taxes remitted.

    The aggression has seen the taxman run ahead of its targets for the first time in over a decade. In its latest tax performance update released last week, the KRA said it collected Sh154.3 billion in October 2021 against a target of Sh142.2 billion.

    Mr Mburu said his agency started the new financial year on an upward trajectory after surpassing its July-September 2021 target of Sh461.6 billion by Sh15 billion, representing a 30 percent growth.

    Cumulatively, the KRA collected Sh631 billion between July and October 2021 against a target of Sh603.9 billion, translating to a performance rate of 104.5 percent, a growth of 28.3 percent and a surplus of Sh27 billion.

    Mr Mburu said the improved performance is anchored in implementation of key strategies, among them tax base expansion that focuses on bringing citizens and business previously not paying taxes.

    Other strategies include enhanced compliance efforts addressing tax evasion and illicit trade as well as extensive use of data and intelligence to unearth unpaid taxes.

    Mr Mburu noted that Kenya’s tax to Gross Domestic Product ratio stands at 13.8 percent, indicating the need to continue enhancing tax collection and reducing tax expenditure in the form of exemptions and incentives to achieve the desired rate of more than 20 percent.

  • KRA Killing Businesses And Will Soon Run Bankrupt, Judge Says

    KRA Killing Businesses And Will Soon Run Bankrupt, Judge Says

    A judge has warned Kenya Revenue Authority to stop killing local companies in the guise of collecting taxes.

    Justice Weldon Korir ruled that the taxman has become a monster in itself by killing local businesses over alleged failure to pay taxes which in turn affect thousands of families whose bread winners are rendered jobless once the companies are shut down.

    According to the judge, KRA itself will soon run bankrupt and fail to meet its tax collection targets if it continues with the trend of closing businesses which are supposed to remit the tax.

    “When KRA proceeds to kill businesses in the guise of collecting taxes, it becomes an undertaker and will itself eventually die since its survival depends on the existence of income generating businesses from which it can collect taxes,” ruled Korir.

    Justice Korir issued the warning in his ruling where he ordered KRA to immediately reopen Mount Kenya Breweries Limited which it had closed over allegations that it had 16,600 bottles of beer affixed with fake excise duty stamps.

    The company complained that KRA officials in the company of armed police officers raided its factory on April 9 where it confiscated the finished products before locking the premises and stopping their operations.

    Justice Korir ruled that although KRA is justified to collect taxes and that the companies have an obligation to declare and remit their taxes, closing their premises and stopping them from operations is not the right way to deal with tax evasion.

    “In the premise, the court issues an order restraining KRA from continuing to lock, sealing doors or in any way denying access to the company’s manufacturing premises. KRA officials are however at liberty to visit the manufacturing premises at any given time to assess the taxes,” ruled Korir.

    He also ordered KRA to reinstate the company’s excise licence and to facilitate the resumption of normal business operations at the factory by resuming the issuance of excise stamps for production and unsealing the manufacturing premises.

    Justice Korir further directed the taxman to release the company’s motor vehicle they had seized on allegations that it was being used to transport the counterfeit products.

    He however clarified that the orders does not stop KRA from pursuing any outstanding and future tax liabilities from the company.

    According to the judge, KRA’s tendency of closing businesses whenever they have tax dispute with certain companies does not protect public interest which is to ensure that taxes are collected.

    “In ensuring that legitimate businesses do not operate over the closures, KRA acts against its core mandate which is to collect taxes since it cannot collect taxes from businesses that are not operational,” ruled Korir.

    In any event, the judge ruled that it is in public interest that the companies continue to operate since it is through their operations that they pay taxes on whatever revenue it generates, offer jobs for its employees and service the loans taken from financial institutions.

    Justice Korir added that the raid on the company’s manufacturing plant located in Nanyuki was an abuse of power since the company had shown it was among the top taxpayers and had been issued with tax compliance certificate.

  • 1pc minimum tax unconstitutional, High Court rules

    1pc minimum tax unconstitutional, High Court rules

    The High Court has declared the minimum tax, which was to be levied on small businesses at the rate of 1% of turnover, unconstitutional and stopped its implementation.

    In his ruling, Justice George Odunga also issued orders barring the Kenya Revenue Authority (KRA) from further implementing or enforcing the provisions of section 12d of the Income Tax Act, which states that “where a person’s Instalment Tax payable is lower than the Minimum Tax, then the Minimum Tax shall be payable.”

    The move has offered reprieve to businesses who had decried heavy taxation.

    In April this year, the High Court in Machakos granted conservatory orders restraining the KRA from enforcing provisions of the minimum tax pending the hearing and determination of a petition challenging it that had been filed in court.

    The minimum tax was introduced under the Finance Act 2020 and was effective from January this year, charged at the rate of one per cent of the gross turnover of a business.

    A petition filed by Kitengela Bars Association had sought to declare the implementation of the tax as unlawful and unconstitutional.

    On Monday morning, the High Court declared provisions of the minimum tax, unconstitutional and the minimum tax guidelines void.

    Justice Odunga ruled that minimum tax has the potential of subjecting Kenyans to double taxation and also unfairly diminishes capital for those making losses while businesses making profits the capital base are unaffected.

    He ruled that minimum tax should be precise and should only target the intended.

    The move has been welcomed by business owners who say implementation of the minimum tax would have had a devastating impact on businesses that are already reeling from the effects COVID-19.

  • KAA assets facing auction over Sh37bn debt

    KAA assets facing auction over Sh37bn debt

    The Kenya Airports Authority (KAA) is at the brink of having its assets seized and auctioned by contractors who are pursuing a piling Sh37 billion debt against the State agency.

    KAA owes both local and foreign contractors the billions of shillings in claims following cancellation of contracts, variation of contracts, interests on delayed payments and accrued fines. The claims are at different stages of arbitration tribunals at Court of Appeal and the High Court.

    Data shared with the National Assembly’s Public Investments Committee (PIC) shows that KAA had a contingent liability of more than Sh36.9 billion by the end of 2016/2017 financial year.

    Most of KAA’s debts is owed to Chinese firms that it hired when rehabilitating the country’s major Airports. The biggest liability being the Sh17.61 billion that Anui Construction Engineering Group and China Aero-Technology International Corporation (Catic) jointly slapped on KAA after it cancelled a Sh64 billion greenfield terminal project at Jomo Kenyatta International Airport (JKIA).

    The agency cancelled the greenfield project on grounds that it lacked adequate funds to oil the project after making an advance payment of Sh4.2 billion to the Chinese firm which moved to court to demand an additional Sh17.6 billion for the project that never took off.

    World Duty Free also instituted a case in 2013 where it is demanding Sh4.93 billion from KAA for breaching of a March 1989 agreement that granted them exclusive rights over duty-free shops at the country’s major airports.

    KAA managing director, Alex Gitari told the parliamentary committee chaired by Mvita MP Abdulswamad Nassir that they appealed against the 2012 award that directed it to pay Sh4.94 billion ($49,096557) in 2018. Sinohydro Corporation is demanding Sh1.5 billion from KAA for the construction of a Sh6.2 billion runway and refurbishing of aircraft pavement at the JKIA.

    Gitari argued that the projects were done in phases subject to availability of funds but the contractor in 2019 presented a claim of Sh1.53 billion for outstanding certificates, interests accrued on delayed payment, tax refunds, retention money, and idle resources after KAA suspended the works.

    He was categorical that no legal proceedings have been instituted against the authority but the parties are considering negotiations to break the impasse. KAA is also under immense pressure from the Kenya Revenue Authority (KRA) who is demanding a Sh4.2 billion tax claim.

    Others who have either issued demand notice or slapped KAA with hefty bills include Doch Company Ltd (Sh955 million), Mitu-Bell Welfare Society,Patrick T Kanyuira (Sh1 billion) Mission Logistics (Sh719.7 million) and Machiri Limited Sh388 million.

    Chinese firm Catic is demanding payments through three different claims of Sh939 million, Sh882 million and Sh486 million, Baseline Architects and three others Sh404 million, Queens Quay Architects International Inc. Sh335 million, China Overseas Engineering Group Sh388 million and  Moniks Agencies which is demanding Sh319 million.