Thursday, October 11, 2012

KRA remain firm as athletes tell taxman to keep off prize money

File | NATION Kenyan pair of silver medallist Sally Jepkosgei Kipyego (right) and bronze medallist Kenya’s Vivian Jepkemoi Cheruiyot celebrate after the women’s 10,000 metres final during the London 2012 Olympic Games on August 3. Kenya Revenue Authority has said it will levy a tax on the prize monet that local athletes earn in races abroad.

File | NATION Kenyan pair of silver medallist Sally Jepkosgei Kipyego (right) and bronze medallist Kenya’s Vivian Jepkemoi Cheruiyot celebrate after the women’s 10,000 metres final during the London 2012 Olympic Games on August 3. Kenya Revenue Authority has said it will levy a tax on the prize monet that local athletes earn in races abroad. 

By JONATHAN KOMEN jkomen@ke.nationmedia.com

Kenya Revenue Authority (KRA) affirmed yesterday that it would not back-track on their move to have athletes taxed on prize money won in races abroad.

The senior deputy commissioner in charge of marketing and communication at KRA, Kennedy Onyonyi, said they would also target athletes’ managers since they also get 15 per cent from what their respective athletes earn.

Onyonyi however clarified that KRA would exempt from tax athletes who will have paid taxes in countries where they won races.

“We shall only target athletes who will have paid less than 30 per cent in taxation in countries where they will have won the money,” Onyonyi said.

“We are certain that their agents or managers are registered with Athletics Kenya; hence they will be required to part with 30 per cent of what they get from the athletes.”

This came as several athletes told the Daily Nation on Wednesday that the move was punitive.

Widening net

Onyonyi said: “We are not targeting athletes per se but casting our net wide to reach those not complying with taxation requirements.”

He said most athletes have been compliant in paying tax from their current places of employment and therefore there should be no problem in also remitting tax on money earned elsewhere.

Earlier on Wednesday, world 5,000 metres and 10,000m champion Vivian Cheruiyot described KRA’s decision as unfair to the Kenyan sports personalities, saying earnings from foreign races have helped turn around the Kenyan economy.

Cheruiyot, the Olympic 5,000m silver and 10,000m bronze medalist, who is also this year’s Laurels Sports Woman of the Year Award winner, said: “We bring the money home and put up investments, on which we are taxed.

“For example, we pay tax for the cement we use in buildings.”

Malot, who finished second in Dusseldorf Marathon in Germany last year, said athletes give the country free publicity in form of sports tourism.

She nonetheless ruled out the possibility of some athletes being tempted to change their citizenship to countries that exempt athletes from taxation.

Invest at home

“Athletes will have no option since everybody would like to invest at home. No one is interested to leave home.”

Also faulting KRA’s decision were Moses Kiptanui, a former world 3,000m steeplechase record holder and three-time world champion, Daniel Komen, the triple world record holder, and Benjamin Limo, the former world 5,000m champion.

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