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KRA shuts down Nanyuki brewer, bosses on the run

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Kenya Revenue Authority (KRA) headquarters Times Towers in Nairobi. FILE PHOTO | NMG

Top directors of a local brewer at the centre of tax evasion investigations are on the run more than two weeks after Kenya Revenue Authority (KRA) shut down the firm for fake stamps and failure to file tax returns.

KRA on Monday said that the directors and chairman of Mount Kenya Breweries have defied the orders to surrender to the taxman and shed light on the investigations.

The taxman closed the brewer’s factory in Nanyuki following the raids that were conducted on April 9 and 10 on allegations of using fake excise duty stamps on their spirits brands and failure to file tax returns.

“Directors and chairman have not surrendered to the authority. They were suspended under section 20 of Excise Duty Act NO. 23 of 2015,” KRA said on Monday.

The taxman did not disclose the estimated revenue losses incurred from the use of the alleged fake stamps but added that it is mulling revoking the brewer’s licences and prosecuting the directors.

“Investigations are still ongoing and the intention is to suspend the license, establish the extent of revenue loss, prosecute the company and directors for tax evasion as soon as investigation is complete,” KRA added.

Mount Kenya Breweries manufactures Sparkler Vodka packaged in 250ml and selling at Sh100.

The company was last year part of 10 firms under investigation for tax evasion through the importation of empty bottles used for packaging alcoholic spirits with no corresponding bottle tops and excise duty stamps.

The raid on the company’s factories comes at a time KRA has intensified crackdown on tax cheats and businesses using fake excise duty stamps that have denied the taxman billions of shillings in taxes.

Parliament last year started summoning senior officials at KRA and the Kenya Bureau of Standards (Kebs) over allegations of colluding with the rogue alcoholic companies to deny the nation billions of shillings in taxes.

Tax evasion in the alcoholic businesses is said to cost the country at least Sh10 billion annually in unpaid taxes.

Rogue firms in the alcohol business also use fake Kebs stamps.

Editor's note: The story has been revised to remove Blue Ice Vodka and Bubblez Vodka which had erroneously been listed as products manufactured by Mount Kenya Breweries.