10 brewers face probe over Sh3bn tax evasion

At least 10 local distillers are under investigations by the Kenya Revenue Authority (KRA) over Sh3.9 billion in tax evasion cases according to a report submitted in the National Assembly.

A KRA document tabled in the house by the Finance and National Planning committee last week, reveals that Zheng Hong (K) Ltd, Patiala Distillers (K) Ltd, London Distillers, Al-garve Distillers, Crystal World, Vinepack Limited, Crywan Enterprises ltd, FRM EA Packers Ltd, Tihan and Vivek Investments Ltd have been evading taxes.

The probe covering January 2019 to March this year emerged as KRA concluded investigations that saw directors of Platinum Distillers Ltd and Two Cousins Distillers Ltd charged in court for evading tax worth Sh845 million.

The KRA document also shows that Platinum Distillers Ltd had Sh479 million in undeclared volumes of stamp usage for ethanol with Two Cousins Distillers Ltd in trouble for the unaccountable stamps and unreported production worth Sh366 million.

“Regarding the companies under query, the Authority has identified various non-compliance issues through tax returns review, investigations, audits and enforcement and has taken appropriate interventions including tax recovery measures and prosecution,” the KRA document says.

This comes as the KRA endeavours to seal tax evasion loopholes as well as cast its net wide to raise at least Sh1.62 trillion as projected by the National Treasury to finance the Sh2.79 trillion budget for the 2020/21 financial year.

The target is a 14 percent drop compared to the Sh1.88 trillion in 2019/20 financial year.

Already, the government is faced with a challenge of meeting its revenue target as Covid-19 pandemic bites.

The KRA document was tabled on the instigation of Ruaraka MP Tom Kajwang on the tax evasion and the repackaging of alcoholic beverages by several companies in the country.