NAIROBI, Kenya, Jan 17 – The office of the president has formally received a petition by a local lobby group to act on an intricate web of illicit alcoholic drinks racket involved in ethanol smuggling and use of fake Kenya Revenue Authority (KRA) stamps to evade tax.
Futa Magendo Action Network (FMAN) told President Uhuru Kenyatta unscrupulous traders are importing illicit ethanol through the Kenya-Tanzania border.
The chain of cartels are also said to be importing untaxed raw spirit from Tanzania, denying KRA billions of shillings.
The Office of the President at Harambee House formally received the petition on Tuesday.
Interior Cabinet Secretary Fred Matiangi was also served the same day.
Inspector General of Police Joseph Boinnet, Director of Criminal Investigations George Kinoti, KRA Commissioner General John Njiraini were also served with the petition.
Others served include the National Intelligence Service Director General Wachira Kameru and National Authority for the Campaign Against Drugs and Alcohol Abuse (NACADA).
“Your Excellency, it is impressive that you been on the forefront on the fight against illicit brews and the revenue realized from this campaign will go far in realizing your promises delivered to the Kenyan people and your government’s vision for the country,” the petition reads in part.
FMAN Executive Coordinator James Mugo said for the past few years, Kenya’s alcohol industry has been a target for fake manufacturers who have been making profits at the expense of genuine manufacturers.
“With the importation of illegal ethanol comes with the affixation of fake revenue stamps printed in and outside the country. The fake stamps are required by the illegal manufacturers since they have not paid any taxes on the products. The stamps are uniquely similar to the untrained eye but are confirmed using an electronic reader,” FMAN’s statement read.
The lobby group recommended KRA to introduce use of electronic barcodes scanners to determine authenticity of KRA stamps and ensure integrity of the taxman’s surveillance team to curb the vice.
They also want distributors and traders found selling products from an unlicensed manufacturer be held accountable.
“The fake products have become attractive to greedy traders who buy the products at a low price and sell at a premium price therefore making big margins. The greedy traders buy the original products and mix with the fake products in the hope of making bigger profits from
the fakes,” Mugo said.
FMAN wants the County Governments through the Council of Governors to ensure compliance of all traders of alcoholic beverages in their respective jurisdictions.
In 2015 President Kenyatta ordered countrywide crackdown which led to the closure of 115 firms and immediate withdrawal of operating licenses for breach of statutory requirements following recommendation of the inspection report by the Inter-Agency Taskforce on Control of Portable Spirit and Combat Illicit Brews chaired by Joseph Irungu.
The report recommends the containers in which neutral spirit is packaged for storage or transport must be marked in accordance with the provisions of Kenya Standard for Neutral Spirit.
Alcoholic drinks products labels are also required to specify the contact details of the respective manufactures including their physical location, telephone and email address.
For the last two years, ninety nine chiefs and sub chiefs alongside fifteen police officers comprising of five OCPD’s and OCS’s have been dismissed from service for frustrating the fight against illicit brews and second hand generation liquor.
Besides the health risks posed by the sale of counterfeit drinks to thousands of Kenyan consumers, the illicit brews have seen government lose billions of shillings in unpaid taxes.