State closes operations of alcohol plant over tax evasion, illicit brew

Oliver Musembi and Mathew Ndung’u

The government has seized Africa Spirits, an alcohol manufacturing plant in Thika that has been implicated in tax evasion and manufacture of illicit drinks.

Top government officials led by Inspector General of police Joseph Boinnet and Kenya Revenue Authority officials visited the premises and declared it a crime scene as detectives investigate how revenue amounting to billions of shillings may have been lost through tax evasion.

Armed police officers have been deployed to guard the premises.

Boinnet said police are pursuing the owners of the company who went into hiding as soon as government officials raided the plant about 10 days ago and recovered 21 million counterfeit excise stamps and 312, 000 litres of suspected illicit ethanol with an estimated tax potential of Sh1.2 billion.

The IG, who was with Directorate of Criminal Investigations boss George Kinoti, warned that action will be taken against any government official who may be implicated in illegal dealings with the manufacturer.

The management of Africa Spirits, which is a licenced manufacturer of portable spirits including Legend brandy, Blue Moon vodka and Furaha gin are said to have been evading tax by affixing illegally acquired KRA labels on their products.

A KRA commissioner Githii Mburu, who accompanied Boinnet,  said the company is suspected to have been smuggling ethanol from Tanzania, among other malpractices.

This operation which is based on intelligence reports is part of the government’s broader campaign against illicit trade aimed at ensuring compliance with tax and consumer protection laws,” Mburu said.

Police have so far arrested and arraigned a production manager who has been remanded for seven days to facilitate further investigations.

Investigators from KRA and the DCI recently raided the plant following intelligence reports pointing towards large consignments of counterfeit excise stamps and suspected illicit ethanol being stashed within their premises.

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