Egerton could lose land over Sh856m tax debt

Egerton University 642 hectare parcel of land in Marigat, Baringo County is at stake as Kenya Revenue Authority holds it title deed over Sh800M tax. [Kipsang Joseph]

Egerton University risks losing a 642-hectare piece of land after the taxman demanded its title deed over Sh856 million tax arrears.

The land is located in Marigat, Baringo County. This was revealed through court documents that the university has filed in response to a suit brought against it by the Egerton University Sacco.

The Sacco is demanding Sh431 million, and the university has filed the response to explain its weak liquidity position.

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Moses Ouma, the university's finance officer, confirmed that the title deed is in the hands of Kenya Revenue Authority (KRA).

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In the documents, the university management has explained that it entered the agreement with KRA on September 26, 2019, after the institutions vice chancellor was arrested over the debt.

“It was agreed that the university shall immediately deposit the title deed for the land known as Baringo/Kimalel/3 approximately 642 hectares as security for the tax liability amounting to Sh816,741,693,” reads part of the agreement.

The agreement has thrown a spanner in the works on plans to build the Baringo University.

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Egerton had agreed to donate 300 acres of this land to the County Government of Baringo for construction of the Baringo University.

In August 24, 2015, Baringo politicians, led by the then Governor Benjamin Cheboi, met at a Nairobi hotel and minutes of the meeting show that already an agreement had been reached with Egerton to build Baringo University on the Egerton land.

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KRA Deputy Commissioner for Public Sector Division Domestic Taxes George Muia signed the agreement on behalf of the taxman.

Others who signed are Paul Mutuku KRA Commissioner Legal Services, Egerton University Vice-chancellor Rose Mwonya and Deputy Vice-chancellor Administration Planning and Development Isaac Kibwage.

Pay immediately

For Egerton to get back the title deed, it was required to pay the taxman Sh40 million immediately the pact was signed, and settle the rest in equal 12 months instalments.

It was agreed that should Egerton fail to remit any of the instalments, KRA was at liberty to forcibly demand the entire debt amount which could mean putting the land in question under the hammer.

“Should the university default to pay any of the tax instalments outlined in this agreement, the authority shall be at liberty to enforce collection of the whole debt as provided for under tax statutes,” the agreement reads.

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It is on the same parcel of land that the Dryland Research Training and Ecotourism Centre, Chemerron is based.

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Kenya Revenue AuthorityEgerton University