Taxman recalls 119 cars as import duty evasion probe gathers pace

Imported second-hand cars at the port of Mombasa on April 8, 2022. PHOTO | WACHIRA MWANGI | NMG

The Kenya Revenue Authority (KRA) has ordered the owners of some 119 motor vehicles to present them for fresh inspection amid investigations into a suspected multi-billion-shilling tax evasion scam.

The taxman said the vehicles should be taken to its offices across the country by October 6, 2023, for inspection and audit of ownership and purchase.

"Present the cars together with the original ownership, sale agreement, transfer and importation documents to the Commissioner of Intelligence, Strategic Operations, Investigations, and Enforcement,” the KRA said as it listed the registration numbers of the affected units.

The taxman is, under the law, mandated to list vehicles that are suspected to have been fraudulently registered before sale.

The East African Community Customs Management Act 2004, further states that having motor vehicles for which duty has not been paid is an offence. “A person who has in his or her possession, keeps or conceals, or procures to be kept or concealed, any goods which he or she knows, or ought reasonably to have known, to be (iii) unaccustomed goods, commits an offence and shall be liable on conviction to imprisonment for a term not exceeding five years or to a fine equal to fifty percent of the dutiable value involved, or both of the goods," says the Act.

The KRA is under pressure to grow collections amid tough economic times.

Tax receipts for the first two months of the current financial year grew at a largely unchanged rate compared to a year ago despite the phased enforcement of new measures by President William Ruto’s administration.

The taxman collected Sh317.58 billion in taxes for the two months through August, Treasury Cabinet Secretary Njuguna Ndung’u reported a growth of 13.33 percent over Sh280.23 billion in a similar period last year.

The growth was, however, the slowest in three years, having grown 13.37 percent in the corresponding period last year over Sh247.18 billion in the July-August period of 2021.

The growth rate in a similar period of the financial year 2021-2022 was 31.42 percent.

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