This archive report was first published on 24 September 2019.
On August 28, 2019, the Kenya Revenue Authority (KRA) sent a notice to the African Reinsurance Corporation (Africa Re) demanding Sh12.8 billion within 30 days, sparking a potential diplomatic tiff between Kenya and other African countries.
Africa Re, a majority-owned subsidiary of the African Union's member states, has protested the taxman's move, terming it a violation of immunity granted to it in 1987 by founder members.
According to correspondence seen by the Nation, the KRA instructed Africa Re's bankers and other institutions holding the continental firm's funds to freeze the accounts and hand over the monies to the taxman.
The freeze has threatened to cause a diplomatic tiff between Kenya and other member states, with Africa Re's shareholders including the African Development Bank, four non-African investors, and over 100 large insurance companies from across the continent.
Africa Re had previously objected to KRA's demand in 2018 through the deputy commissioner of domestic tax, but the protest was dismissed. The KRA claims that Africa Re did not appeal the tribunal decision, hence it should pay the amount.
