Former Nairobi governor Evans Kidero has been ordered to pay over Ksh400 million tax to the Kenya Revenue Authority (KRA).
The High Court on Tuesday, February 8, ruled that Kidero had failed to prove that the funds in question were raised and used for political campaigns.
Justice David Majanja faulted a previous Tribunal judgement and ruled that the burden of proof was on Dr Kidero to demonstrate that the funds raised for the campaigns were actually utilized for that purpose.
Audits carried out by the Commissioner for Domestic Taxes (DTD) showed that the proceeds from fundraisers by Kidero were being deposited together with other business proceeds into his personal bank accounts.
Majanja ruled in favour of the commissioner and allowed KRA to proceed and recover the sum of Ksh427,269,795.
The Commissioner for Domestic Taxes (DTD) further conducted an audit of Kidero's finances and business ventures.
According to the taxman, the former governor and the Commissioner reached a consensus that funds raised for political party campaigns were not chargeable to tax.
Both parties failed to agree on whether Kidero who was then vying for Nairobi gubernatorial seat had demonstrated that the funds he raised were actually expended in political campaigns.
"When tasked to avail a bank account for his campaign funds, Kidero furnished the commissioner with names of various contributors and a single-page document titled Statement of Receipts and Expenditure indicating the monies received and expended on various items.
"Dissatisfied with this information, the commissioner raised a tax assessment for KSh427,269,795.00 that precipitated an appeal at the Tax Appeals Tribunal (TAT)," a statement by DTD, a department within KRA detailed.
The Tribunal had issued a verdict in favour of Kidero stating that he explained the source of the funds and it was the Commissioner's role to establish if the funds were channelled to the ex-governor's campaigns.
During his re-election bid, Kidero set aside Ksh423 million and spent Ksh418 million on campaigns. He was allegedly left with Ksh4 million after losing the race to Mike Sonko, who was impeached in December 2020.
According to court documents, Kidero used Ksh53 million to set up a campaign centre to run his operations and Ksh37 million was spent on sponsoring the Orange Democratic Movement (ODM).
He spent Ksh7 million to rent an office space for his political activities for 36 months while a whopping Ksh8 million was used to research and poll tracking and spent Ksh20 million on unveiling his bid.
Kidero also spent Ksh25 million for nominations while Ksh75 million funded media and publicity events. He further used Ksh47 million on public relations materials and his campaign agents consumed Ksh55 million.
To monitor the election, Kidero used Ksh25 million, Ksh19 million to fuel his vehicles and a similar amount to repair them.
He also parted with Ksh6 million to entertain his campaigners and another Ksh16 million as capital expenditure.
