Luthuli Avenue electronics dealer to pay KRA Sh700m

An electronic dealer based at Nairobi’s Luthuli Avenue will have to pay Kenya Revenue Authority’s (KRA) Sh700 million of undeclared tax after the Tax Appeals Tribunal dismissed its objection to KRA’s assessment.

A four-member tribunal ruled that Digital Box ltd, which deals in buying and selling of electronics on Luthuli Avenue, failed to prove that the Commissioner of Domestic tax used unreasonable assessment to arrive at the amount.

“The Tribunal is of the view that the Appellant (Digital Box ltd) did not discharge its burden of proof in showing that the Respondent (KRA) used extraneous considerations and documents other than those prescribed by the law,” the Tribunal chaired by Catherine Mutava ruled.

The company, which deals in buying and selling of electronics, said KRA officers raided its premises in February 2017 on Luthuli Avenue as well as one of the directors’ home in Parklands and carted away documents.

And after a while KRA said the company was liable to pay Sh700,584,224, but Digital Box disputed saying the taxman had failed to consider the costs of the purchases for the years 2014, 2015 and 2016 in its computation.

Further, the dealer challenged KRA’s assessment alleging that the taxman misapplied the banking analysis test to establish its tax liabilities.

The company further faulted KRA said it erred by basing its assessment of the sales made and VAT payable, using delivery notebooks.