NAIROBI, Kenya, Feb 19 -The Kenya Revenue Authority (KRA) has launched investigations following an exposé by the University of Bath’s Tobacco Control Research Group and The Investigative Desk as well as Tax Justice Network Africa, alleging tax cheats involving British American Tobacco.
The report suggests that British American Tobacco Kenya (BAT Kenya) may have underpaid taxes by $28 million for the fiscal years 2017 and 2018.
The taxman, in a statement, emphasized its commitment to maintaining the integrity of Kenya’s tax system and pledged to thoroughly review the findings.
“kRA is committed to upholding the integrity of Kenya’s tax system. We are currently reviewing the findings of the report and will take appropriate action,” read the statement in part.
“Our mandate is to ensure that all corporationsoperating within Kenya comply fully with tax regulations, and any evidence of tax avoidance or evasion will be addressed with the utmost urgency.”
The authority reiterated its dedication to working closely with all stakeholders to safeguard Kenya’s revenue and broader economic interests.
Earlier, BAT Kenya dismissed the allegations, stating that the company conducted a thorough review of the report and found it to contain ‘numerous errors and misrepresentations’ of the company’s financial disclosures and tax obligations.
He added that the company’s financial records had been audited both by external auditors and regulators, including for the years 2017 and 2018, which were referenced in the report.
Its CEO, Crispin Achola, criticized the methodology used in the report, stating that its authors applied ‘erroneous assumptions’ in their calculations of BAT Kenya’s revenues, profits, and tax dues.
He noted that the figures were based on incorrect pricing, a disregard for trade margins, and misrepresented deductible costs.
BAT Kenya also noted that in June 2024, it had received a request for comment from The Investigative Desk but was not informed about the methodology used in the report’s analysis.
The company claimed it had cautioned that the resulting figures would be overstated.
