Lamu West MP Stanley Muthama was on Tuesday freed on bond by an Eldoret court after being charged with fraud and tax evasion that cost the state more than Sh487 million.
Muthama was charged along with his company Stansha Limited. He denied the 13 charges when he appeared before chief magistrate Charles Obulutsa.
He was charged that being a registered taxpayer and in receipt of income derived from business activities within Kericho, Kajiado and Nakuru counties, he failed to pay tax, including VAT and Paye, amounting to Sh487,914,642 between 2013 and 2017.
He was released on a bond of Sh3 million and a cash bail Sh500,000. The case will be mentioned on July 15.
Muthama is accused of making false tax returns for his company after business activities for several years. The false returns made the state lose the money that would have been paid as taxes.
“This is a very serious case of tax fraud that affects the functions of the state and it’s a case of great interest to Kenyans that also amounts to economic sabotage," prosecutor Sheila Sanga said.
Muthama was represented by lawyers Nathan Tororei and Jane Masai.
One of the charges stated that Muthama, his company and others not before court allegedly knowingly made incorrect statements in the income tax company returns of Stansha Limited which affected the tax liability of Sh12.7 million.
In another charge, Muthama was accused of making similar incorrect returns for the company which affected a tax liability of Sh6.9 million in 2013.
He is also accused of omitting Sh2.1 million Pay As You Earn (Paye) returns of employees in 2015. The following year, he also reportedly omitted Paye returns of Sh2.06 million for his employees.
The MP also faced another charge which stated that being in receipt of income from business activities in the three counties in 2016, he made another false entry of tax returns for Stansha which affected the tax liability by Sh138 million.
In 2017, Muthama is accused that he knowingly omitted from VAT returns of Stansha Limited Sh44.1 million. He faced similar charges all totalling to the Sh487 million that the state lost.
Edited by R.Wamochie
