Wednesday, March 11, 2009
Is Calif Record's A Case of Tax Evasion or Ignorance?
Reports in the ‘gossip trash’ media circles abound that the KRA has ‘shut down’ Calif Studios because of tax evasion. My first issue with these reports is that they are written in a ‘celebratory’ tone. If Kenya’s biggest and most influential urban music production house has been shut down, it is sad news indeed for Kenya’s entertainment industry – the gossip trash media circles included!
The real issue of concern however is KRA, and especially how they conduct their business of ‘punishing’ tax defaulters. We’re living under the dark cloud of a ‘global recession’ and world markets are crushing like the gunny bag dykes in Budalangi during the rainy season. The result; massive unemployment. Now why in common sense’s name would KRA want to shut down a business model that’s creating employment?
Despite the media reports, I strongly believe that Calif Records were not evading taxes; they were simply ignorant about taxation and everything else concerned with giving unto Caesar what is his. If the Government of Kenya and all its agencies (read KRA in this case) is serious about creating employment, they should seriously think about educating young business people about tax.