MPs grill Njiraini over Sh17bn excise duty system report

What you need to know:

Directive follows petition by manufacturers who oppose the Sh1.50 per stamp system.
KRA was to roll out the new tax, which required manufacturers and importers to affix the new generation excise stamps on bottled water, juices, soda, energy drinks, other non-alcoholic beverages, food supplements and cosmetics from November 1.

Kenya Revenue Authority (KRA) commissioner-general John Njiraini is set to be grilled by MPs over a special audit report on the procurement of e-tax stamps that the High Court annulled recently.

Mr Njiraini said he will honour the invitations to appear before the Public Investment Committee (PIC) this morning but described the summon as subjudice as the matter is in court.

He did not disclose the parties in the latest suit on the procurement of the Excisable Goods Management System (EGMS).

The High Court two weeks ago quashed the tender and declared the planned levying of Excise Duty on bottled water, juices, soda, other non-alcoholic beverages and cosmetics unconstitutional, offering consumers relief from price increment.

The court found that the KRA and the National Treasury had not complied with the requirement of public participation and did not involve stakeholders before rolling out the tax.

READ: KRA loses Sh7.3bn to fake stamps, goods

The taxman was expected to collect at least Sh3.6 billion in revenue from the tax annually.

KRA was to roll out the new tax, which required manufacturers and importers to affix the new generation excise stamps on bottled water, juices, soda, energy drinks, other non-alcoholic beverages, food supplements and cosmetics from November 1.

“KRA has written to us to confirm the meeting but have put a rider that the issue is in court. But we know that the issue that was determined in court was lack of public participation in the award of the tender to a Swiss firm,” Abdulswamad Nassir, who chairs PIC said.

He said the committee will dwell on the Special Audit on the procurement of the Sh17 billion single sourced tender that PIC ordered in the last Parliament.