KRA BLOCKS WIND-UP OF 1, 092 FIRMS OVER US$8M TAX ARREARS
NAIROBI - The Kenya Revenue Authority (KRA) is seeking to stop some 1, 092 companies from closing business before they pay US$7, 815, 500 million tax arrears that the taxman says they owe.
KRA says it has formally filed an objection at the Attorney-General’s office to stop the dissolution of the firms before they settle their tax dues.
During the period between July 2022 and March 2023, the companies through the Registrar of Companies issued 90day notices through the Kenya Gazette alerting the public of their intended voluntary dissolution.
KRA says it has been puzzled by the applications of the firms - which range from single proprietor businesses, family-owned firms, and local subsidiaries of international firms - for voluntary strike-off while still owing tax debts to the government.
“The KRA has lodged objections barring 1,092 companies from intended dissolution and striking off from the Registrar of Companies for the period July 2022 to March 2023 before the settlement of tax liabilities.
Cumulatively, these companies owe US$7, 815, 500 million in unpaid taxes to KRA,” said the tax agency.
KRA says it has given sufficient reasons to the Registrar of Companies to temporarily stop the dissolution of the companies, pending the unsettled tax dues.
“KRA requires directors of companies due for closure, to pay their tax debts before submitting their applications to the Registrar. This will ensure the companies are compliant and that the tax issues are resolved amicably,” said KRA.
Data from the companies’ registry shows some 1, 068 companies were struck off the list of registered companies between July and December last year.
KRA’s move comes at a time it is tightening the noose on businesses to seal revenue leakages as it seeks to hit ambitious tax revenue targets set by President William Ruto to fund the budget.