Tatu Investors Accuse Foreign Colleagues of Tax Evasion

By Virginia Nyambura

Tatu City investors on Tuesday alleged that their foreign colleagues had sent billions of shillings from a land sale in Kenya to accounts in Germany, Mauritius, and Bermuda while evading payment of the required taxes.

The allegations made by Tatu City chairman, Nahashon Nyagah, and Tatu City minority shareholder, Stephen Mwagiru, was seeking Parliament’s intervention in a bid to safeguard Kenya’s interest in the multi-billion shilling real estate development transaction and force the foreign directors to pay the necessary taxes for the land transaction.

During the National Assembly’s Land committee session, Mr.Stephen Mwagiru presented documents that showed a difference in the figures indicated as having been paid for the transfer of land to the potential investors and what was actually declared in the Ministry of Land records.

“We noticed irregular entries in titles at the Ministry of Land. I have documents to show that property that was sold at over Sh1 billion is claimed to have been sold at Sh200 million to evade stamp duty and income tax,” Mr Mwagiru declared accusing Tatu City management, led by Stephen Jennings, of under-declaring the valuations in order to “swindle the Kenyan government of its income tax.”

Mr. Mwagiru spoke of land title number 11428, apparently sold at 219 million shillings but whose records in the title at the Ministry of Land clearly show that it was sold 814.8 million shillings. Another title numbered 11287 was said to have been transferred to another firm at 330 million shillings when it was actually valued at1.3 billion shillings which resulted to a loss of 38 million shillings in stamp duty and 291.7 million shillings in income tax.

Title number10887, was also mentioned as having been under declared after it was marked as sold for 842 million shillings when the actual price was 235 million shillings while land title numbered 11486 valuations was declared as 340 million shillings instead of its actual price of 1.19 billion shillings while LR No 8749 was declared as selling for 2.7 million shillings when the actual price was 628 million shillings.

Mr. Mwagiru was, however, directed by the chairperson of the committee, Rachael Nyamai, to avail original documents in seven days to support his claims terming the allegations very serious as the report showed that the government could have lost 1.38 billion shillings in taxes alone adding to the stamp duty totaling around 200 million shillings not submitted.

When asked whether he was aware of tax evasion, Mr. Nyagah, Tatu City Chairman, said, “I have a bible of Tatu City transactions having been the founder chairman and director and I will present to you given time.”

“I am in court to know whether there are unpaid taxes. I have asked for an audit because I don’t want the whole land, originally 11,500 acres sold without interest of Kenyans safeguarded,” Mr. Nyagah informed the committee.

He concluded by requesting more time to prepare an in-depth report citing that they had a lot of material and he needed to prepare so that he could provide his submissions with proper documentary backing.