Nairobi — Members of Parliament have summoned Kenya Revenue Authority (KRA) Commissioner-General Humphrey Wattanga over claims the country lost over the Sh62 billion in a tax evasion scandal by Louis Dreyfus Company (LDC) Asia PTA limited and Louis Dreyfus Company Kenya (LDC) limited.
This is after details emerged of misdeclaration of palm oil cargo imported by the two companies over three years.
This is even as the taxman has been missing its revenue targets forcing
the government to increase borrowing from the local and foreign market to bridge the funding deficits in the budget, unnecessarily subjecting Kenyans to debts.
The Finance and National Planning Committee of the National Assembly wants Wattanga for a grilling session.
In the summons of August 29, 2024, sent to the KRA boss, the committee chaired by Molo MP Kimani Kuria has raised seven particulars that it wants clarified during a session with MPs.
"From the foregoing and the importance of revenue mobilization in the country, the Committee resolved to invite you for a meeting to shed light on the matter," the letter by Senior Deputy Clerk Jeremiah Ndombi on behalf of the Clerk of the National Assembly Samuel Njoroge, reads in part.
Documents before the committee show that the product imported by LDC companies whose intended use is in Kenya and the other East African countries using the port of Mombasa for imports, is mis-declared in two ways.
First, the product comes as a blending of 60 percent crude palm oil with refined palm oil of 40 percent, which is then declared as crude palm oil.
Alternatively, the product is largely imported in refined form but declared as crude palm oil at the port of Mombasa so as to evade the 35 percent import duty or USD500 charged per tonne.
The product also attracts Import Declaration Fee (IDF) at the rate of 2.5 percent, Railway Development Levy of 1.5 percent and Value Added Tax (VAT) 16 percent.
In Kenya, 35 percent duty is charged on imported refined palm oil with semi refined palm oil attracting 10 percent duty.
To get to the bottom of the matter, the committee wants Mr Wattanga to provide details on the total cargo volume of palm oil imported by LDC Asia PTA through the port of Mombasa from February 23, 2023 and June 26, 2024.
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The details should include the volumes of RBD Palm Stearin, Crude Palm Kernel Oil, Crude Palm Olein, Crude Palm Oil, and Crude Palm Fatty Acid Distillate.
The Committee also wants Wattanga to provide details regarding the total taxes and fees paid by LDC Asia PTA in the importation of the palm oil cargo from February 23, 2023 and June 26, 2024.
Copies of all import declaration documents which are not limited to port health reports, Kenya Bureau of Standards (KeBS) reports, bills of ladings and cargo manifests for all the 120 cargo of palm oil imported by the company from February 23, 2023 and June 26, 2024 are also required.
Also required by the committee is a list of consignees of all the palm oil cargo volumes imported by the company during the period.
The committee also details of cargo volume of RBD Palm Stearin, Crude Palm Kernel Oil, Crude Palm Olein, Crude Palm Oil, and Crude Palm Fatty Acid Distillate imported by LDC- Kenya limited, Acee Limited, Mazeras Oil Limited and Vipingo Industries Limited through the port of Mombasa from February 23, 2023 and June 26, 2024.
Further, Mr Wattanga is required to provide details of the taxes and fees paid by LDC- Kenya limited, Acee limited, Mazeras Oil limited and Vipingo Industries limited in the importation of the palm oil products between February 23, 2023 and June 26, 2024.
The copies of all import declaration documents for palm oil cargo by LDC- Kenya limited, Acee limited, Mazeras Oil limited and Vipingo Industries limited through the port of Mombasa from February 23, 2023 and June 26, 2024 are required.
The copies, the committee stated, should not be limited to port health reports, KeBS, SGS reports, bills of lading and cargo manifests.
