Only unsold stock qualifies for VAT refunds, says court

KRA Commissioner General James Mburu listens to Director of Public Prosecutions Noordin Haji at the Prosecution Training Institute grounds in Loresho, Nairobi, early this year. [Collins Kweyu, Standard]

Manufacturers can only get Value Added Tax (VAT) refunds on unsold stock. This follows a High Court ruling against a petition by three drug manufacturers.

High Court Judge Weldon Korir, while dismissing the petition, noted that the manufacturers had not indicated the unsold stock on which they claimed a refund of VAT input tax. Previously known as sales tax, VAT is levied at consumption at a maximum rate of 16 per cent.