NAIROBI, Kenya, Feb 6 – Kenyans are paying more for excisable products as a Swiss manufacturer of tax stamps make billions of shillings.
This comes at a time when the Kenya Revenue Authority (KRA) plans to quadruple fees manufacturers must pay for stamps on excisable goods.
Price hikes will impact final product prices for alcohol, juice, cigarettes and makeup.
Now, Minority Leader Opiyo Wandayi has called for an official audit into the Excisable Goods Management System (EGMS), which administers the tax stamps and has been operated by a Swiss supplier known as SICPA Security Solutions SA since 2011.
Wandayi says SICPA has made a profit of Sh64 billion in just five years under the terms of a contract mired in secrecy.
Stephen Mutoro, chairman of Stop Crime Kenya (StoCK), said: “The KRA will need to address transparency issues around the single-sourced and non-competitive procurement of SICPA. There have been many objections through the courts and now Parliament.
“KRA receives much less commission from the tax it collects on behalf of government. It’s unacceptable that SICPA pockets several hundreds of times the commission from EGMS. We are exporting our taxpayers’ funds with little or no return.
“The EGMS was meant to cut the level of illicit trade involving excisable goods. Unfortunately, the vice has spiralled and government has not raised revenue. The only winners are cartels, not consumers or state coffers. This is unsustainable. It cannot be treated like business as usual.”
StoCK welcomes the call by the Minority Leader at the National Assembly Opiyo Wandayi to audit the whole EGMS arrangement. Our view is that the EGMS operated by SICPA is a scandal of huge proportions. It must be halted sooner rather than later.”
