KRA WIN

Beach hotel loses Sh74 million tax case

The hotelier confessed to owing Sh74 million in taxes.

In Summary

• In a ruling delivered on September 11, the tribunal ruled in favour of KRA denying the taxpayer extension of time to file an appeal.

• KRA opposed the application on the ground that the taxes it sought to collect were based on taxpayer’s own self-assessments.

The Kenya Revenue Authority can now proceed with its scheme to collect outstanding taxes from Kisii Safari Inns Ltd T/A Kaskazi Beach Hotel.
The Kenya Revenue Authority can now proceed with its scheme to collect outstanding taxes from Kisii Safari Inns Ltd T/A Kaskazi Beach Hotel.
Image: FILE

The Kenya Revenue Authority can now proceed with its scheme to collect outstanding taxes from Kisii Safari Inns Ltd T/A Kaskazi Beach Hotel.

This follows a ruling by The Tax Appeals Tribunal dismissing the taxpayer’s application challenging the collection of taxes amounting to Sh74 million.

In a ruling delivered on September 11, the tribunal ruled in favour of KRA denying the taxpayer extension of time to file an appeal.

 

The judge ruled that the owners of the establishments had failed to file an appeal within the statutory stipulated timelines.

They had filed an application seeking to have time enlarged in order to appeal to challenge the enforcement measures initiated by the Revenue Authority to collect the outstanding revenue.

KRA opposed the application on the ground that the taxes it sought to collect were based on taxpayer’s own self-assessments.

The authority further argued that the hotelier had admitted owing the taxes demanded but had failed to make payments or present an agreeable payment plan.

While agreeing with KRA, the Tax Appeals Tribunal held that it was unable to extend the time for the Taxpayer to file an appeal unless and until the taxpayer pays the undisputed taxes.

In June, the taxman also won a case against BTB Insurance Brokers Limited allowing the collection of Sh35 million in taxes.

In an appeal to the High Court, BTB Insurance Brokers Limited sought to overturn a decision made by the Tax Appeals Tribunal in 2016.

 

In a statement, the Commissioner of Legal Services and Board Coordination Paul Matuku said that between July 2013 and September 2014, BTB Insurance Brokers Limited failed to charge Excise Duty on its commission income contrary to the provisions of the Customs and Excise Act.     

"This led KRA to raise an Excise Duty demand of Sh35,788,553. Aggrieved by the demand, BTB Insurance Brokers Limited appealed to the Tax Appeals Tribunal in 2016," Matuku said.