The Anti-Counterfeit Agency on Monday evening raided an illegal distillery in Mutuati, Igembe North and impounded illicit liquor and distilling machinery valued at Sh40 million.
Six workers at the factory were arrested but the alleged owner managed to escape the dragnet.
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The agency's assistant enforcement director, Lindsay Kipkemoi, who led the operation, said the estimated loss that the Government could have incurred on the fake Kenya Revenue Authority and Kenya Bureau of Standards stamps at the illegal factory amounts to Sh10 million.
More than 5,000 litres of ethanol and 2,000 boxes full of liquor bottles that were waiting to be sold were also impounded.
No permit or licence
"The factory manufactures about five brands illegally. It has no permit or licence for it operations. Whatever we have found here does not meet the standards of a distillery," said Mr Kipkemoi.
The official added that the plant posed health risks to the consumers of the alcohol.
"This is actually a great loss to the Government in terms of raising revenue and at the same time the health issues since no standards have been enforced. The legal manufacturers are also incurring losses because the illegal liquor is sold with bottles bearing their stickers, " Kipkemoi said.