KRA spares cereals board assets hammer over tax dues

The Kenya Revenue Authority has suspended sale of the National Cereals and Produce Board (NCPB) assets aimed at recovering a Sh1.9 billion tax arrears bill and assured that it would meet the auctioneer’s fees.
The taxman’s decision follows intervention by the National Assembly Agriculture Committee, which had a fortnight ago asked where the authority expected the board to get the money from.

Leakey Auctioneers served a 10-day notice to the NCPB on May 16, 2016, a job that required them to be paid Sh74 million.

The tax arrears are a product of VAT on agency services the board offered the National Strategic Food Reserve between 2002 and 2012.

KRA Commissioner-General John Njiraini told the Parliamentary committee they had seen it prudent to suspend the auction.

“Kindly note that the note of distress dated 16 May 2016 for Sh1.9 billion served on yourselves (NCPB) is hereby suspended until further notice,” read a letter tabled by Mr Njiraini to the committee.

Agriculture Cabinet Secretary Willy Bett commended the progress made in concluding the matter which started in 2007. “We are pursuing the abandonment route as opposed to setting a budget aside for the debt and the NCPB has already committed the same to the KRA,” Mr Bett told Parliament.

A tax audit by KRA on NCPB for the period 2002 to June 2006 established tax arrears of Sh501.9 million, which was on VAT charged on commission for the agency services.

KRA wrote to the board on February 13, 2013 informing the agency of VAT due, demanding it complies through payment.