Taxman: We lost Sh 36 billion in taxes due to sugar imports :: Kenya

The government lost 36 billion shillings duty-free for sugar imports. ;last year.

The amount is sufficient to finance free education for three fiscal years.

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Apart from the fact that the government is losing taxes, some importers took advantage of this period to ship 90 blocks of narcotics.

The Treasury had published a Gazette 4536 note authorizing the importation of duty-free sugar between October and December of last year, following a prolonged drought in growing areas sugar.

The Gazette notice did not specify the quality or quantity of sugar to be shipped in the country. It also allowed everyone, including unauthorized companies, to import.

It is through this window that the Kenya Revenue Authority (KRA) now admits that it has lost up to 36.6 billion shillings in taxes.

Further revelations will be made today when the Joint Agriculture and Trade Committee will table a report on the floor of the House this afternoon after a six-week investigation. days.

According to KRA, 113 major importers shipped 818,151 metric tonnes of brown sugar into the country duty-free. 13 small traders imported 185 metric tons.

John Njiraini, chief executive of the Kenya Revenue Authority, told MPs that investigations were underway to find out whether narcotic substances were included in imports.

Narcotics Suspected

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He told the committee that four alleged unsealed polypropylene bags were found hidden in bags of sugar imported by a company registered in Uganda.

"The 90 blocks suspected of being narcotics were marked as exhibits and packed in evidence bags and held by the Anti-Narcotics Police Unit." Currently, the issue is being handled by the relevant government agency, "said Njiraini.

The Tax also stated to the Committee that raw cane sugar imported under the exemption regime was presented to Customs in 50 kilogram bags and in unsecured bulk carriers.

The head of the KRA told the committee headed by Kanini Kega (Kieni) and Adan Haji (Mandera South) that the release of any imported sugar was authorized by the relevant regulatory authorities.

"In all cases where unpackaged sugar was imported, all regulatory agencies, including the Kenya Bureau of Standards (Kebs), Port Health and Radiation Board, certified that the goods could be imported" .

Deadline for exemption

On the expiry of the initial tax exemption period, the KRA received applications to facilitate duty-free entry of sugar whose arrival would have been delayed by various logistical difficulties. .

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Njiraini told the committee that KRA has informed the National Treasury of its inability to admit sugar duty-free given tight deadlines.

"The KRA intercepted 40,000 metric tons of brown sugar from Brazil, declared to have been loaded in the gazette's notice, and diligent to ensure that only the sugar met the requirements of the Gazette. requirements specified in the Gazette, says Njiraini.

He said that the authority refused to allow the duty-free import and demanded 2.5 billion shillings of taxes.

The importer objected to the claim and filed a lawsuit, still pending before the Supreme Court.