Keroche Breweries has challenged the amount of tax demanded by the Kenya Revenue Authority (KRA), saying it is incorrect.
In August 2019, the brewery’s directors were arrested for tax evasion amounting to 14.1 billion shillings, but it claims its twice the actual tax they owe the authority.
According to Keroche, it blended 60.9 million liters of Crescent Vodka with 101.1 million liters of distilled water to produce 162 million liters of Vienna Ice ready-to-drink vodka, with a 15% alcohol content. However, the Kenya Revenue Authority (KRA) claims that 101.1 million liters of water was used to dilute 60.9 million liters of vodka.
Out of 60.9 million liters of crescent vodka at Sh120 per liter, Keroche was to pay Sh7.3 billion in taxes.
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However, KRA’s alleged that 101.1 million liters was used to dilute the 60.9 million liters, representing a Sh12.1 billion tax plus a VAT of 1.9 billion-amounting to Sh14 billion.
“Kenya has shortages of fools to believe that 101,088,000.00 Liters of distilled water can generate Kes.12 billion as excise tax unless a miracle was performed and water was turned into vodka,” Karanja said.
“The only person we know who changed water into wine was Jesus and it was given for free to the multitude,” She added.
According to Tabitha, the legal case has hindered the company’s ability to obtain funding both domestically and internationally, following the adverse impact of the COVID-19 pandemic which resulted in the closure of clubs for a two-year period.
“We highly condemn the actions by the DPP to continually frustrate Keroche breweries on fake claims,” Karanja said.
“This is against the clarion call by the president’s on broadening the tax bracket while damaging a company that in full capacity is capable of generating a billion Kenya shillings in monthly tax remittances given a conducive environment.”