Governors and VCs to face law over taxes

The State will take legal action against heads of counties and universities who have not been remitting taxes to the Kenya Revenue Authority (KRA).

Acting National Treasury Cabinet Secretary Ukur Yatani (pictured) said some governors, vice-chancellors and chief executives of government agencies had not been remitting statutory deductions, including Pay As You Earn (PAYE), to the taxman.

“We are aware that there are some counties, parastatals and universities that have withheld PAYE due to KRA, which is criminal. They will have to bear the responsibility," said Mr Yatani.

Yatani, who made the remarks on Friday at St Paul's University in Limuru during the institution’s 28th graduation ceremony, said it was the duty of every Kenyan to pay taxes to enable the Government to fund its development agenda.

“The Treasury and KRA are working round the clock to make sure we run a transparent tax system where every person pays up. Those who have been engaging in tax evasion must know that their time is up," he said.

The CS said the defaulters could enter into an agency agreement with KRA and clear their arrears over five years.

Yatani’s remarks came after details emerged last week that KRA had frozen accounts of 11 public universities over Sh9.7 billion tax arrears.

Analysts fear KRA's decision to attach the universities' bank accounts is likely to cripple operations in the public learning institutions, some which have been struggling financially.

The arrears by the universities are mainly PAYE remittances that have not been made for years.

Last month, details also emerged that KRA was going after seven governors whose counties failed to remit Sh13 billion in taxes.

The governors were among the first batch of leaders who were expected to appear before KRA's Tax Dispute Resolution Division based at Ushuru Pension Towers in Upper Hill, Nairobi.

According to KRA, Nairobi owes Sh4.5 billion, Kiambu (Sh3.2 billion), Kilifi (Sh2 billion) and Migori (Sh1.3 billion).