The estate of tycoon Gerishon Kirima owes the Kenya Revenue Authority Sh632 million in taxes.
In his latest report, the Auditor General, Edward Ouko, queries why KRA has failed to collect the dues in spite of demand notices and negotiations.
Mr Ouko is also asking why KRA reduced the amount to about a half of what it originally demanded seven years ago. Kirima (pictured), who was a former Starehe MP politician, died in December 2010.
According to the report, KRA first issued an agency and demand notice to the estate of Kirima on February 15, 2011 for tax arrears of Sh583,152,109. This was followed by a distress warrant dated on April 4, 2011.
“However, on April 12, 2011, Rachier & Amollo Company Advocates, on behalf of the taxpayer, asked for one month to put the taxpayer’s records in order and make payments. After one month, KRA failed to collect the taxes,” Ouko says.
On November 22, 2012, the agency notice dated February 15, 2011 was withdrawn and substituted with another agency notice dated June 25, 2013 for tax debt outstanding of Sh631,859,960.
Ouko says the June 2013 notice was also suspended for 30 days pending deliberations and provision of more records. On November 25, 2013, there was a late objection on estimated assessments of Sh631,859,960, which was accepted by the authority.
Ouko says that the outstanding ledger on Kirima’s estate is Sh374,632,164, which has yet to be paid while the estate did not file returns in 2015 and 2016.
“Further, it has not been explained how the tax liability was agreed at Sh374,632,164 instead of Sh631,859,960,” Ouko says.