The Kenya Revenue Authority (KRA) has cautioned businesses and taxpayers against tax evasion as it steps up a nationwide crackdown on schemes suspected of depriving the government of millions of shillings in revenue.
The warning followed the seizure of more than 55,000 smartphones at Eldoret International Airport on Tuesday, September 22, in an operation that prevented an estimated Ksh21.5 million tax loss.
The consignment had initially been declared under five Customs entries as containing only 3,000 smartphones alongside shoes, automotive spare parts, household goods, electronic accessories and other assorted items.
However, a subsequent verification exercise uncovered 55,607 ordinary smartphones. Officers also found 309 high-end smartphones that had not been declared, highlighting the scale of the alleged tax evasion.
"The intelligence received indicated that the consignment contained unmanifested mobile phones and other high-end electronic goods," KRA enforcement officers revealed.
According to the Authority, the goods had either been under-declared or omitted from the Customs declaration altogether, contrary to Section 203 of the East African Community Customs Management Act (EACCMA), 2004.
Under the law, making a false Customs declaration or participating in tax evasion constitutes an offence punishable by up to three years in prison or a fine of up to Ksh1.2 million.
“We are actively working to uncover tax evasion schemes, improve compliance with tax laws and procedures, and promote fair trade in the market," the Authority stated.
KRA also urged members of the public, taxpayers and businesses to report individuals, companies or networks suspected of generating, selling, purchasing or using fictitious VAT invoices.
"KRA is appealing to members of the public, taxpayers and businesses with information concerning persons, companies or networks involved in the generation, sale, purchase or use of fictitious VAT invoices to come forward and share such information," the Authority said.
The Eldoret airport seizure came five days after KRA intercepted a bus transporting cigarettes, tobacco and powdered milk worth Ksh46.7 million in an intelligence-led operation along the Uganda-Kenya route.
During the September 16 operation, the Authority said the consignment could have resulted in a Ksh29.17 million tax loss.
KRA officers reportedly mounted an ambush in Eldoret before intercepting the vehicle, with the suspect subsequently arrested and detained at Kondoo in the Burnt Forest area.
The bus was escorted back to Eldoret and taken to a KRA warehouse for further inspection.
