Keroche Breweries is grasping on straws as its financial crisis deepens. The local brewer has salary arrears running into over two months and has also defaulted on a tax repayment plan with the Kenya Revenue Authority.
According to a report that appeared in a local daily, Keroche was shut down by the KRA in December 2021. However, it was reopened during the festive season after the management entered into an agreement with the taxman.
The report quoted Keroche chief executive officer Tabitha Karanja saying that the money problems the brewer is facing had resulted in a two-month salary delay. She however denied claims by some of her employees that the salary delays were running into over six months.
Ms. Karanja said that the pandemic had taken a heavy toll on her business leading to the current problems. “To be candid, the ripple effect of the disease greatly affected our tax obligation and this resulted in arrears amounting to Sh. 270 million,” she told the daily. “Before the pandemic, we were able to pay the Sh. 200 million (tax) comfortably but we had a slight delay in settling the outstanding amount.”
Ms. Karanja also revealed that Keroche had been shut for a period of two weeks in December.
“We are hoping to continue honouring our tax obligations going forward as things are now looking up,” she said. “We have weathered the storm and with the goodwill from the KRA, we shall continue to pay our taxes.”
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Keroche has been entangled in a long running battle with KRA over a Sh. 9.1 billion tax dispute. The courts ruled that Keroche should pay KRA Sh. 500 million as the hearing went on. However, Keroche protested that it could not raise the amount and asked for an out of court settlement. KRA and Keroche then entered into an alternative dispute agreement over the dispute.
The troubles facing the brewer have come barely months after Ms. Karanja announced that she would be quitting her position this year to contest for the Nakuru senatorial seat in this year’s August General Elections.