Kenya Revenue Authority (KRA) CEO James Mburu has said that a breach of agreement by Keroche Breweries led to the closure of the Naivasha-based firm.
In an interview with Business Daily Digital, Mburu said that KRA and Keroche had agreed on a payment plan for tax arrears but the firm did not honour the agreement.
According to the KRA CEO, Keroche had been given 24 months to pay its tax arrears with the firm required to pay an initial payment in March to facilitate re-opening.
“They were to do an initial payment in March to facilitate reopening then we agreed on the instalments that were to be paid every month beginning at the end of April,” Mburu stated.
He added that when Keroche paid the initial instalment, KRA reopened the firm and waited for it to honour the payment of the arrears.
Mburu, however, said that the firm failed to do that and, according to their agreement, if they failed, then KRA had the freedom to enforce action according to the law.
He said that KRA closed down the firm as it was not fair to the many Kenyans who were diligent in paying their taxes.
“And that is what we did. We took the action of ensuring that if they are to continue to operating and not remitting taxes, it is a not fair and just to the millions of Kenyans who are diligent in payment of taxes,” he said.
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However, in a statement on Tuesday, June 14, Keroche CEO Tabitha Karanja said that they were compelled to enter into an agreement with KRA whose implementation could not be supported by the company.
"After negotiating under tremendous pressure with a large team of your commissioners and top officers we were compelled to enter an agreement whose implementation on the face of it could not be supported by the company's performance in its immediate post covid 19 economic effects," Tabitha stated.
The Keroche CEO said that she had informed KRA they could not meet their tax obligation in one month but her pleas fell on deaf ears.