Police have arrested three Chinese real estate developers over a Sh26 million tax evasion scheme.
Announcing the arrest, Kenya Revenue Authority (KRA) yesterday said the directors of Tianyi Limited are expected to be arraigned on Monday.
KRA Commissioner Investigation and Enforcement David Yego said Mr Zhang Xiaodong, Mr Ming Zhao and Mr He Youging had failed to remit the amount due in tax after sale of houses in River Park Estate, Athi River.
“Investigations revealed that the three failed to declare and remit taxes amounting to Sh26 million from the sale of 171 units,” Mr Yego said in statement.
KRA has recently locked horns with a number of Chinese firms over failure to comply with tax laws as a the number of investors from the Asian country increase in Kenya.
Chinese construction firm, China Aero Technology International Engineering Corporation and its director Huang Hongyou were charged with several counts including failure to file tax returns in the required language.
Also in the crosshairs is tech firm, X-Tigi whose four bank accounts the taxman wants frozen on suspicion it has been evading taxes and stashing proceeds from its business in Hong Kong.
In 2016, three major Chinese multinationals were faced with a lengthy tax investigation that ended in court after KRA found that they were involved in a complex transfer pricing scheme.
Some firms provided information to KRA officials in Chinese language, reportedly to frustrate audit while others bluntly refused to provide crucial data.
ZTE Kenya, a subsidiary of a Chinese tech giant firm in Kenya that supplies telecommunication equipment in the country was said to have owed the taxman Sh1.44 billion in unpaid corporate and Withholding tax since 2011.
In August, police busted another tax evasion ring run by Chinese nationals who were found using smuggled methanol in Athi River to brew traditional liquor (chang’aa) at a residential place.
Mr Wang Yalan and Ms Wang Haijian, were also found in possession of 1,000 litres of methanol.