The Kenya Revenue Authority has withdrawn an agency notice it issued against the Nairobi county government over the contentious Sh3.5 billion unpaid taxes.
This after a crunch meeting on Wednesday between Governor Mike Sonko and top management of KRA resolved to lift the notice.
The lifting of the notice has given City Hall a reprieve. The taxman had placed City Hall on its black books and attached its accounts as the two bodies fought over the unpaid taxes.
“KRA has agreed to lift with immediate effect the Agency Notice against the Nairobi City County Government over a contentious Sh3.5 billion tax bill,” Sonko said after the meeting.
Sonko met KRA Commissioner for Domestic Taxes, Elizabeth Meyo, the Deputy Commissioner in charge of Accounts Management, Daniel Kagira, and representatives from Public Sector Division and Enforcement Division of KRA, led by Acting Commissioner Stephen Kyande.
According to the deal struck between the two parties, Sonko’s administration will immediately pay Sh242 million, part of the contested Sh3.5 billion.
The payment will be made pending a comprehensive audit and reconciliation that will be concluded in the next 10 days.
Last year, City Hall paid Sh3 billion to clear part of the outstanding statutory remittances incurred by previous administrations.
“I wish to thank KRA for the good approach they have taken to resolve this matter, and assure them of my personal commitment to continue with our timely remittances going forward, as we settle the old debts we inherited.
City Hall has been in bad terms with KRA and other government bodies over unremitted statutory deductions amounting to billions of shillings.
National Hospital Insurance Fund (NHIF), National Social Security Fund (NSSF), LAPFUND and LAPTRUST are some of the bodies demanding billions from City Hall.
In 2012, the defunct Nairobi City County Council transferred multi-million Mariakani estate to LAPFUND in a swap deal to clear part of the debt.
The estate was signed off by the then Town Clerk Roba Duba, who is currently the secretary general of the Kenya County Government Workers Association.
