BAT refutes claims that ‘Battle of minds’ Completion is meant to promote Tobacco  

BAT Kenya has refuted claims made in various media channels that the Battle of Minds student competition serves to advertise and promote its tobacco products. In a Statement released today by the spokesperson for BAT Kenya said: “Battle of Minds is the BAT Group’s global internship competition designed to offer graduates who are 18 years and above, an opportunity to gain real practical work experience. Our aim is to strengthen the company’s talent pool and develop the next generation of leaders. “Established to attract, celebrate and support the best and brightest…

Keroche Tax burden

The KRA is set to collect tax of Kshs 9,116,835,985 .00 from Keroche Breweries Limited with regard to products manufactured and marketed by Keroche breweries Limited. This follows a big win by the Kenya Revenue Authority in the six (6) Appeals filed by Keroche before the Tax Appeals Tribunal in 2015 and 2017 respectively. 2.  In three of the Appeals, the contention was the manufacturing process of Vienna Ice Brand of Vodka. The brewer argued that, Vienna Ice brand of Vodka was not a distinct product from Crescent Vodka since Vienna Vodka was produced by diluting Crescent Vodka which process did not amount to manufacture. 3.  KRA relied on the Compounding of Denatured Spirits Act Cap 123 and argued that the process undertaken by Keroche Breweries was compounding within the meaning of the Act. Compounding of spirits also amounted to manufacture of new product within the definition of Customs & Excise Act, CAP 472 (now repealed). 4. In the other three appeals, the contention was with regard to classification of pineapple based wines. The Brewer had argued that what they produced was fortified wines which should be classified under HS Code 22.04 which attracted lower excise duty rate of 40%. Their position was that the classification was specific for any fortified wine. 5.   KRA’s position was that HS code 22.04 was reserved for wines based on grapes and the Keroche’s fortified wine was purely fermented pineapple as such is to be classified under HS Code 22.06 which is for any other fermented beverage. HS code 22.06 attracted a higher excise duty rate of 60%. 6.    The Tax Appeals Tribunal in its’ judgments delivered on 9th March, 2020 held that: 6.1.   Keroche Breweries Limited was involved in the compounding of spirit which amounts to manufacture within the meaning in Excise Duty Act, 2015 and Customs and Excise Act, CAP 472 (repealed)as such Vienna Ice was a distinct product for which Excise Duty was payable; 6.2.  With regard to Fortified wines produced by the Brewer, the Tribunal guided by the World Customs Organization explanatory notes on HS code found that HS code 22.04 was for grape based wines and the correct classification was HS code 22.06 as the Keroche’s wine is a mixture of fermented pineapple and alcohol. 7.  The Tribunal however faulted the Authority for levying interest and late payment penalties for the period the disputes were being litigated at the High Court and the Court of Appeal which had directed that the matters be heard at the Tax Appeals Tribunal.

Tax Appeals Tribunal rules in favour of KRA against Roshina Timber Mart Limited 

Tax Appeals Tribunal rules in favour of KRA against Roshina Timber Mart Limited  The Tax Appeals Tribunal (TAT) has ruled in favour of the Kenya Revenue Authority (KRA) in a case filed by Roshina Timber Mart Limited seeking orders to stop KRA from disallowing input VAT that was based on fictitious tax invoices from ghost traders, dubbed the “missing traders” scheme. The scheme was established to reduce tax liability without the taxpayer making taxable supplies or the supplier of the goods being captured on the tax invoices used to deduct input VAT. In its ruling delivered on 26th February 2020, the TAT held that the law places the burden of providing supporting documentation on the taxpayer and in the absence of such documentation; KRA is left with no option but to apply the law and assess the tax. The Tribunal further stated that failure to keep, retain or maintain records is an offence as stipulated under Section 93 of the Tax Procedures Act, 2015. This means that accepting the position advanced by Roshina Timber Mart Limited and allowing input VAT recovery would amount to aiding criminal conduct. The company argued that it had no obligation or responsibility to trace the supplier and  did  not  doubt  the  existence  of  suppliers  who  issued  it  with  the  invoices. The TAT also established that the VAT Act, 2013 stipulates that for input VAT to be allowable for deduction, it must have been incurred for the purpose of business or to make taxable supplies. KRA was therefore correct in seeking for additional documentation to prove that there were taxable supplies made to the company. The Tribunal went on to state that even if proof had been provided to show that the supplies took place, KRA was still within its power to establish whether the input VAT claimed by the company was incurred for business purposes in order to allow or disallow its recovery. The Tribunal further determined that KRA rightly demanded Corporation Tax from the impugned transactions with the phantom “missing traders”. KRA has previously experienced similar challenges where unscrupulous taxpayers who do not make taxable supplies use fictitious tax invoices to claim input VAT. The ruling is a boost to KRA in the fight against such schemes.  

African Legal Support Facility launches new handbook on sovereign debt at 10th anniversary

The handbook discusses the fundamentals of sovereign debt, including the technical, financial and legal aspects of debt instruments and the markets in which they are traded. The African Legal Support Facility (ALSF) has launched a handbook on sovereign debt aimed at improving users’ understanding of the subject and offering development and implementation strategies and tips to avoid over-indebtedness. The Handbook on Sovereign Debt, produced by the ALSF in collaboration with 11 prominent debt professionals, was officially launched February 27 in Abidjan, on the first day of a High-Level Forum, convened…

Google.org announces a Sh100 million grant to promote safe internet use by children

Google.org, has announced a Sh100 million grant to promote safe internet use by children, young people and families in Africa. The organization, which is Google’s philanthropic arm, says the grant will support training by non-profit and social enterprises focusing on privacy, trust and safety in Africa. Charles Murito, Country Director for Google Kenya says the fund will be administered by a third-party partner, on behalf of Google.org. In addition to providing organizations with funds to help support the online safety efforts for children, Google is also looking at expanding programs…

Nairobi Jubilee MCAs comes to Sonkos Aid

Jubilee MCAs in Nairobi have resolved to rally behind Govenor Mike Sonko who is battling an impeachment motion tabled last week. The MCAs,both elected and nominated held a meeting on Sunday afternoon in Nairobi, where they made a decision to unanimously oppose the motion tabled by Makongeni MCA Peter Imwatok . Imwatok wants Sonko out over corruption,incompetence and inability to put order at City Hall. But the Jubilee MCAs, according to Umoja one mca Mark Mugambi ,claim that the issues are already before court and that it should be left…

Rice importers charged with Ksh1.5 billion Tax Evasion

Two businessmen of Pakistani Nationality were today charged before Mombasa Chief Magistrate Ms Edna Nyaloti for evading tax worth Ksh1.5 billion. The traders, Rahim Qasim and Rameez Gulzar Ali alongside their firm Jhulay Lal Commodities limited were found to have been importing rice into the country while deliberately failing to pay Income Tax. According to investigations, it was established that for the period covering January 2015 and December 2018, the suspects imported rice worth Ksh1.68 Billion. They sold the rice and banked the proceeds in their various companies’ accounts. The…

Dandora kids make history as the first Kenyan talents to feature in a Cartoon Network show

Some 9 school-going children aged between 7-14 yrs, from Dandora slums, will be the first Kenyan talents to feature in a Cartoon Network (CN) show. The Cartoon Network Pop Up Party Show will be beamed to a global audience from 29th Feb. It is also the first show for the network to be shot in Kenya. The 9 dynamic talents will be performing today’s trendiest dance moves including Bazokizo, Shaku Shaku, Vimbada, Gwara Gwara among others. The talents will produce 8 brand new stylish videos highlighting one dance style performed…

Nairobi Women’s Hospital responds to claims of extorting patients

The Nairobi Women’s Hospital (NWH) board has denied allegations that the hospital was admitting patients and holding them at the hospital. In a statement issued on January 3rd, 2020, the hospital’s Board of Directors said they’d noted with a lot of concern reports appearing in media suggesting that there is some “systematic approach by the hospital to unfairly generate revenue from patients.” “Although we don’t believe this is the case, and in fact, it is antithetical to our foundational principles, we take these allegations very seriously and are conducting an…

MCAs urge CECs to support Sonko,warn against misappropriation

Nairobi MCAs have warned executive officers against sabotaging Govenor Mike Sonko in service delivery. Led by majority leader Charles Thuo , the MCAs have vowed to support the govenor even as he battles his court case. The MCAs have asserted that Sonko is firmly in charge and that no one should think of using his absence from office to sabotage him or subvert county resources. “The governor is fully in charge and no one should think of taking advantage of his predicament to swindle resources,” Thuo said . Thuo said…