The Kenya Revenue Authority(KRA) had announced its plans to recover approximately Sh3.6 billion from cosmetics, non-alcoholic beverages, bottled water, and juices annually.
As a result a gazette notice was issued on October 3 stating that all imported products would have to bear the regulator’s stamp.
According to reports, the move was made in part to help enhance tax revenue.
“Currently, revenue performance in this sector is at less than 40 per cent. The roll-out of EGMS to this sector is aimed at reversing this poor tax compliance,” commissioner for domestic taxes Benson Korongo said.
Read: KRA Collects 10 Billion Rent Income Tax
However, the High Court has temporarily suspend KRA’s plans after activist Okiya Omtatah filed a law suit against the Treasury Cabinet Secretary, the Kenya Revenue Authority commissioner general and Switzerland-based firm SICPA Securities.
“Pending hearing and determination of this case, a conservatory order suspending the public notice which KRA published in the national press and the media, ” High Court judge John Mativo said.
Omtatah claims that the move by KRA is against the law because it would put manufacturers, importers and consumers at a disadvantage since they would be forced to pay for additional costs of production.
Manufacturers involved had been told to submit full details of their brands for registration in the Excise Goods Management System (EGMS) system by October 19 with the products set to bare excise stamps as of November 1.
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