Kenya: Karuturi Guilty of Tax Evasion

24 April 2013

The Kenyan government has found Karuturi Global Ltd, the world's biggest producer of cut roses, guilty of tax evasion. This is the first time an African government has brought a large multinational company to court for transfer mispricing through a fully public process. A broad alliance of civil society movements and organisations are celebrating the Kenyan government's resolve to stop such behaviour and to do so transparently.

In late 2012, the Kenya Revenue Authority ruled that the Bangalore, India-based multinational used transfer mispricing to avoid paying the government of Kenya nearly US$11 million (EUR8 million) in corporate income tax, part of a larger set of tax disputes with government authorities that amount to a quarter of the firm's 2012 sales. On 4 April 2013, Karuturi appealed the ruling, bringing the proceedings into the public domain.

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