Taxman loses court battle with Coca Cola

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The Kenya Revenue Authority (KRA) has suffered a blow after the High Court sitting in Nairobi allowed an appeal lodged by CocaCola Central East and West Africa Limited contesting a ruling issued by the Tax Appeals Tribunal (TAT) in 2013 that okayed the taxman’s intention to collect Ksh516 million from the appellant.

The issue for determination in the appeal was whether marketing services provided by the appellant to Coca Cola Export, a company located outside Kenya amounted to exported services and thus chargeable to Value Added Tax (VAT) at the rate of zero percent.

Since 2013, KRA has relied on the CocaCola case as decided by TAT as a precedent in assessing and issuing tax decisions regarding VAT on exported services. -Business Today

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