The Kenyan High Court has ruled that Keroche breweries pay KRA Sh. 8 million monthly as settlement of their tax arrears with KRA until a court hearing commences.
This is order was issued by High Court Judge Alfred Mabeya of the Milimani Commercial Division. It came almost two months after KRA vowed they would not allow Keroche Breweries to continue with business until tax arrears amounting to Sh. 22. 79 billion are paid.
“An order be and is hereby issued that the defendant taxman, its officers, agencies associates to unseal the packaging line, the stores and to reactivate the Exercisable Goods Management System (EGMS) in the Applicant’s Keroche Breweries plant in Naivasha and to generally allow the applicant to carry on with business forthwith,” the High Court ruled.
Keroche Breweries CEO, Tabitha Karanja had said that more than 400 employees at Keroche had been affected by the closure while Sh. 350 Million worth of beer was going to waste.
However, last month Keroche Breweries publicly admitted that they could not accumulate the required finances to pay the alleged amount by KRA. This instead led to the high court ordering them to clear their Sh. 957 million tax arrears.
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In the revised payment plan for Keroche, the brewer will be required by law to pay Sh. 8 Million every 30th day of the month to the Kenya Revenue Authority (KRA) until the next court hearing which is scheduled for September 22, 2022.
As a surety that Keroche will honor this, they were required to pay Sh. 8 Million within the first 7 days after the ruling, as the first installment of the tax arrears. On the other hand, KRA is now required to step back and avoid closing, interrupting or intruding on Keroche Breweries’ operations.
Previously, KRA has accused Keroche of defaulting on the payment plans earlier before, the last deal being agreed on being half a billion shillings in December 2021. In March 2022, Keroche was offered by KRA 24 months to clear tax arrears.
“The taxpayer did not honor the payment plan agreed upon for the third time… to allow a tax evading business to continue operating despite it dishonoring all payment plans is to promote a culture of impunity, promote unfairness and allow a few to use public funds to enrich themselves,” KRA Commissioner Githii Mburu was quoted stating during the period of the KRA crackdown at Keroche.