NAIROBI, Kenya, Mar 17 – Keroche Breweries has been ordered by the High Court to pay Kenya Revenue Authority Sh500 million for its five bank accounts to be unfrozen.
The taxman froze the brewer’s bank accounts on Thursday, a move it said would help in collecting Sh9 billion of unpaid taxes.
Keroche Breweries Limited had gone to court under a certificate of urgency seeking orders to lift the agency notice served to its banks by KRA.
KRA had issue the notice to enable it to recover the money, following the orders given by the Tax Appeal Tribunal (TAT) on 9th March 2020.
Keroche has been involved in a tax war with the authority in cases dating back to 2015.
The tax disputes are of different kinds; one involves Keroche’s production process while the other is hinged on the classification of wines and the associated taxes.
In the first case, the company says the production of its Vienna Ice beverage does not amount to manufacture as the liquor is processed by diluting crescent vodka, adding that the two brands are the same product.
On its part, KRA says it relied on the compounding of denatured spirits act cap 123 to argue that the process equates to the manufacture of a new product.
On the second dispute, Keroche says it only deals in fortified wine products whose excise duty is 40 percent while the taxman says the brewer ought to pay 60 percent since it does not produce products in the category on which the lower rate applies.