Business highlights July 17 2017

Business highlights July 17 2017

Coca-Cola, KRA in court over Sh516 million row

Giant multinational company, Coca-Cola, is at loggerheads with Kenya’s taxman over sh516 million paid to the beverage manufacturer as fees for marketing and branding services provided.

Coca-Cola Central East and West Africa Limited is objecting the demand by the Kenya Revenue Authority (KRA) to recover the money from them.

The VAT appeals tribunal ruled in favour of KRA in 2012, prompting Coca-Cola to move to court.

While imposing the tax, KRA argued that some of the services Coca-Cola provided by the firm are consumed locally hence should be treated as services consumed in Kenya.

The firm, however, insists that the services were provided on behalf of its American Parent firm, hence fall under zero-rated export services.

KRA is yet to respond to the suit.

Lexo Energy opens shop in Kenya

Dutch oil marketer Lexo Energy has launched its operations in Nairobi. This becomes the second African market after Mauritius.

Lexo’s entry comes amid exit plans by another Anglo-Dutch oil marketer, Shell.

The oil marketer enters the country with a multi-billion-shillings kitty which it plans to use to establish 25 petrol stations across the country this year.

“We plan to have between 15 and 25 petrol stations before the end of the year,” Lexo Energy Nairobi office manager Koki Mulwa said.

The company has already opened retail stations in Busia and Mumias with Nairobi being the next destination.

Each station will cost approximately Ksh2.5 billion.

Equity closes investment banking unit

Equity Bank Group has shut down its investment banking arm, Equity Investment Bank, which offers corporate finance, investment advisory and wealth management services.

The bank, which is Kenya’s largest lender by market capitalization, has attributed the move to a fall in trading volumes and stiff competition which has made it difficult to penetrate the market which is dominated by stand-alone investment banks.

Equity Bank will however maintain its license as it continues to offer brokerage services. Affected staff will also not lose their jobs but will be transferred to other departments within the bank to focu on more profitable businesses.

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