KRA denies claims on apron buses taxes

July 14, 2015 3:36 pm
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Acting Customs Commissioner Julius Musyoki confirmed that the Relief and Mission Logistics paid tax on the five buses amounting to Sh30.574 million but they were exempted from import tax amounting to Sh3.8 million/FILE
Acting Customs Commissioner Julius Musyoki confirmed that the Relief and Mission Logistics paid tax on the five buses amounting to Sh30.574 million but they were exempted from import tax amounting to Sh3.8 million/FILE
NAIROBI, Kenya, Jul 14 – The Kenya Revenue Authority has refuted claims by the Kenya Airport Authority Board that five apron buses imported for use at JKIA were smuggled into the country.

Acting Customs Commissioner Julius Musyoki confirmed that the Relief and Mission Logistics paid tax on the five buses amounting to Sh30.574 million but they were exempted from import tax amounting to Sh3.8 million.

The taxes paid were in regards to the Import Declaration Fee (which is usually 2.25 percent of the customs value of any consignment), Value Added Tax and Railway Development Fund, which is at 1.5 percent of the customs value.

It has emerged that KRA mistakenly issued a waiver on one of the apron buses which was manufactured five years ago contrary to the law which proscribes that for an imported vehicle to enjoy a waiver it must be new and manufactured in the same year the exemption is being sought.

KRA Customs Department official Benson Chacha told the National Assembly Committee on Transport that although the country lost Sh7.6 million in taxes on the buses, the decision to waive duty was aimed at facilitating trade at the airport.

“We accept that just to relate we might have needed to go back, but from the document we had and considering where those documents were going to be used, we chose to say that, for the sake of the government and trade facilitation. The airport is place for all of us, we believed that if we facilitated trade there, it will be good for all of us.”

KAA Director Kevin Kihara last month sensationally told the committee that the concessionaire did not pay the requisite duty to the Kenya Revenue Authority.

Kihara stated: “I would like to astound the members, and tell you that the apron buses that were delivered were smuggled into this country. This is from the Simba System in Kilindini which conforms that the five buses were not paid duty for.”

READ: JKIA apron buses were smuggled into Kenya, lawmakers told

The firm that operated the controversial apron buses at the Jomo Kenyatta International Airport (JKIA) says the vehicles were legally imported, dismissing claims by the Kenya Airports Authority (KAA) that they were smuggled into the country.

In a statement, Relief and Mission Logistics said they followed the laid down procedures of importing the buses after getting exemption clearance from the Kenya Revenue Authority.

“Relief and Mission Logistics wishes to refute claims reported in the media about the apron buses provided by the firm. KRA provided clearance and exemption for the buses vide the attached letter under 5th schedule Part B, item 1(b) (IV) of the EAC Customs Management Act,” the firm stated.

READ: Apron buses got duty exemption from KRA – firm

Chacha said they will now be asking the concession company to pay full duty on the bus after the KAA Board terminated the contract.

“Now that they are not going to be there, you are going to give us a go ahead or KAA will have to give us a go ahead to tell them if they are not working, to pay for them,” Chacha said.

The probe follows the suspension six senior management staff after President Uhuru Kenyatta questioned the rational of leasing five-ramp passenger buses at Sh10 million per month and ordered the arrest of those involved.

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