The Kenya Revenue Authority is investigating political activist and INJECT Party leader Morara Kebaso over alleged tax evasion.
KRA is investigating Morara for allegedly failing to file tax returns on Ksh 186 million made by his businesses for the past three years.
The Authority stated that the vocal activist has been declaring nil income.
In a notice sent to Morara, KRA has listed five companies, including Igrow Digital Enterprise, Morara Home Furniture, Luku Fashion, Morara Properties Limited (Blacksmith Morara Limited), and Backtent Security Limited.
The Authority noted that these businesses “have been declaring nil income or not filing returns despite the ownership of properties, business undertakings, and other assets.”
KRA Goes After Morara for Alleged Tax Evasion of Ksh186M
At the same time, the taxman has listed three bank accounts belonging to Morara Properties Limited, Morara Home Furniture, and Kebaso himself, indicating that these accounts have been receiving money over the last three years.
According to KRA, Morara Properties and Morara Home Furniture, operate in the real estate and furniture selling sectors, respectively, with deposits mainly coming from M-Pesa paybill transactions.
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The third account, registered under Morara’s name, also receives payments via M-Pesa, primarily for furniture and interior fittings.
In KRA’s analysis of the three bank accounts, which was reviewed by The Nation, the tax authority revealed that the accounts received trade credits of Ksh 9.5 million, Ksh 31.9 million and Ksh 144.9 million in 2022 2023, and 2024 respectively, bringing the total to Ksh 186.3 million over the past three years.
Of these accounts, Morara Home Furniture accounted for nearly 80 percent of the total deposits, receiving Ksh 146.9 million.
“The trade credits were compared with income tax turnover declared in the income tax returns, to which it was noted that you are a non-filer, to determine undeclared income turnover. It was noted that you are not registered for Value Added Tax (VAT),” KRA said.
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KRA now states that Morara will be “forcefully registered by the Commissioner as provided for in Section 34 of the VAT Act” after his businesses exceeded the Ksh5 million threshold for bank deposits.
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Additionally, the authority mentioned that Morar’s businesses have VAT due of Ksh 25.7 million.
KRA also stated that a margin of 12 percent is usually calculated for businesses dealing in home furniture, based on taxpayers’ declarations.
As a result, the authority estimates that Morara’s businesses accumulated Ksh 252,091, Ksh 1.1 million and Ksh1.4 million in 2022, 2023 and 2024 respectively in income tax.
However, the 12 percent margin was not applied to 2024, which generated Ksh 144.8 million, as the income tax for that year is not yet due.
In total, KRA claims that Morara Kebaso owes Ksh27 million in taxes, including Ksh 25.7 million in VAT and Ksh1.37 million in income tax.
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