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By Phyllis Muchoki
The Kenya Revenue Authority (KRA) seems to have reached a truce with Keroche Breweries following long-hours negotiations with the owners of the embattled firm over a disputed Sh22.79 billion tax bill.
Several reports indicate that the taxman had reached for settling the dispute even though further talks are lined up in the coming days in an effort to strike a deal.
If the conditions are amicable met, it would see the Naivasha-based brewer proceed to pay tax arrears under the negotiated agreement in exchange for the opening of the brewer’s factory – with timelines also to be known.
On Monday, Keroche requested the KRA to grant it a grace period of 18 months to clear taxes in arrears while paying the current ones as they fall due, arguing that it was unable to honor an earlier payment plan due to frequent disruptions from the taxman.
It has also appealed to the KRA to allow the reopening of its plant in Naivasha to prevent huge losses and lift the agency notices with the 36 banks, which demanded the lenders wire cash from the Keroche accounts to the taxman’s bankers.
Keroche said it had over two million litres of beer worth about Sh512 million in its storage with a fixed maintenance cost of Sh30 million per month.
The tax agency accuses Keroche of defaulting on agreed plans to clear the tax arrears, including a deal to pay half a billion shillings monthly from December to clear part of tax arrears amounting to Sh4.49 billion.
The finances of Keroche, a private company, are not publicly available but it is expected to struggle to raise the billions of shillings if the revenue authority has its way, placing the brewer’s assets and those of its shareholders at risk.
The taxman also imposed a freeze barring 36 banks from dealing with the 25-year-old family-owned brewer famous for its Summit Lager and Summit Malt beers.