Eyes on BAT Kenya as taxman probes Sh3.6b discrepancy
Thursday twentieth February, 2025 07:40 AM|
Listen to This Article
Enhance your studying expertise by listening to this text.
British American Tobacco (BAT) Kenya may quickly discover itself in a sizzling soup, if the allegations of tax evasion apply amounting to Sh$28 million (Sh3.6 billion) for the interval between 2017 and 2018 and inconsistencies in its books of accounts the place some Sh9.6 billion are in query, are discovered to be true.
This comes after Kenya Revenue Authority (KRA) Commissioner for Domestic Taxes division, by way of a press release to newsrooms acknowledged that they’re at present reviewing the findings of the report earlier than taking an applicable motion.
“KRA takes these allegations seriously and is committed to upholding the integrity of Kenya’s tax system. We are currently reviewing the findings of the report and will take appropriate action. Our mandate is to ensure that all corporations operating within Kenya comply fully with tax regulations, and any evidence of tax avoidance or evasion will be addressed with the utmost urgency,” the commissioner mentioned.
BAT Managing Director Crispin Achola on Tuesday refuted the claims, saying the corporate complies with all of the guiding rules and that the figures issued within the report are inaccurate and deceptive.
He mentioned their books are often audited by each the Company’s exterior auditor and the regulator, together with the 2017 and 2018, fiscal years in query.
He nevertheless, acknowledged that in June 2024, BAT Kenya certainly obtained a request from The Investigative Desk for feedback relating to the problems coated within the report however their queries didn’t replicate the methodology used to analyse BAT knowledge.
“BAT Kenya unequivocally and firmly rejects the allegations made, including those regarding the discrepancy between the company’s published financial disclosures and data referred to in the report. The company publishes its financial disclosures in its Annual Reports and audited Financial Statements in line with the applicable local regulations and international reporting standards,” he mentioned.
Achola accused the journalists of publishing overstated figures, stating that it’s at present weighing its choices regarding the influence of the allegations on the corporate.
“Worryingly, in efforts to reconstruct BAT Kenya’s numbers for their analysis, the authors of the report proceeded to apply erroneous assumptions in their calculation of the company’s revenues, profit, and tax due for cigarette sales. This includes the use of incorrect prices, a disregard of applicable trade margins and costs deductible,” he added.
In regards to farmers exploitation, related our bodies such because the Central Organisation of Trade Unions (COTU) and the Ministry of Labour and Social Protection are but to touch upon the problem. According to the report, the agency additionally exploits its farmers by slashing upto 60 per cent of the farmers salaries to cater for the tobacco manufacturing inputs that it supplies them with.