Rachier: Gor Mahia is being victimized by KRA
courtesy of the Nation
Failure by Gor Mahia to deduct and remit income tax from players’ salaries has prompted Kenya Revenue Authority to demand Sh118 million from the club.
Last week, the taxman forwarded a demand note to Gor Mahia and went ahead to block the club’s accounts, putting the team in financial problems.
This turn of events means that if an amicable settlement is not reached soon, the club, which is yet to get a new sponsor, risks running into big financial problems.
The club’s monthly wage bill is slightly above Sh2.7 million and with no sponsors and frozen accounts, the club will find it difficult to pay players.
ACCOUNTS BLOCKED
In an interview with Daily Nation Sport on Wednesday, Gor Mahia chairman Ambrose Rachier confirmed that the accounts had been blocked and the club was walking on a tight rope.
“They (KRA) have blocked our money everywhere which has crippled club operations. We could as well close shop as we do not have any means to pay players,” Rachier said.
Club secretary-general Chris Omondi added: “Things are grim, the situation is bad and we are yet to figure the way forward.”
KRA wrote to Gor last week through its former sponsors Tuzo requiring the club to pay Sh118 million in income tax. The move by the taxman prompted Tuzo to withhold money meant to pay players’ salaries last month. The club however sought funds and paid players.
Omondi said that the issue of taxing players’ salaries is a “hot potato” that needed time to be address. “The issue of taxing players’ salaries is a hot topic. It is something I touched on when I ascended to office and should be handled carefully.”
Rachier added that club will issue a comprehensive statement on the matter in the next two days as they are still consulting legal experts.
He cried foul, insisting that the league champions were being unfairly targeted as no other premier league club has been treated the same way.
“We are reading sinister motive in the move by KRA. Why just us. I mean there are 16 Premier League clubs, why just single out Gor Mahia? Rachier charged.
KRA’S TAKE
When contacted on Wednesday, KRA’s acting deputy commissioner Ezekiel Maru refuted Gor’s claims.
“KRA wishes to clarify that Gor Mahia is not the only club under compliance monitoring. As a matter of fact, some clubs have already made payment, while others are still under compliance check.
“The law as it stands today requires KRA to collect taxes on all incomes earned by sportspersons, including football clubs. However a number of football clubs were found not to be filing returns or paying relevant taxes (Pay As You Earn) for their employees and players. Gor Mahia was identified among others, as a non-compliant taxpayer in the football clubs focus group,” Marwa said in the statement.
However, it has since emerged that some of the 16 clubs in the top tier league have also not met their tax obligations regarding players’ salaries and allowances.
Comrades,may someone bring me up to speed when when the clause requiring sportsmen to pay taxes came to force.I know it did but want to refer to the calender.Somthing doesn’t add up even with KRAs defence that Gor is a non compliant tax payer.That figure could only be arrived at if the taxes in were backdated which means to a time law had not come to effect.How are athletes taxed?So the taxman consider races and meets they,athletes,participated in before this law came to effect?And why just Gor?We are all tax payers and the taxman treat us such.When Maru tells us that Gor was picked as one among many,that’s hogwash.All the KPL teams are known and should be treated equally.I have never digressed into politics on this site but today I want to say that I smell politics here.I fear that the Jubilee government has put a knife on the fabric that holds the Luo nation together,with an eye to 2017 election,so that nothing will persuade this ethnic group to rethink it’s political destiny then this should.I am not a Luo.The matrix for 2017 is getting a bit complicated for some luminaries in the coalition and a big tribe is needed as a fallback measure just in case the equation doesn’t balance.During the campaign we will be told how Gor was rescued from imminent demise by a politician turned philanthropist.We,as Gor fans,will be reminded that a company linked to the said politician was our Shirt sponsor.Secondly,this club is associated with the football loving former premier,Raila Odinga.There are rumors that he might contest.This is not good news to some in the Jubilee corner.By touching Gor the government knows it is putting a hot knife through the heart of the Luos in general and Jakom in particular.Justice is never selective.All the 16 TPL clubs should be subjected to this requirement not just Gor.If all athletes are subjected why not all clubs?Sorry for digressing into politics.This is my personal opinion.
kindly mei samone drive 4 the blongers hw this .118 million comes, kra,corruption nayo? mbona mkusema kabla hatujaanza fundraiser soon? the issue of dedacting playerz salary u shud b squared with the playerz .najua kra hana do ndyo maana,kusota kwenu
evn though kra cld be right but alot of hatred has been emphasised let the arrears be calculatd plus penalti we see the truth
kra is a big gvmnt institution but with unprofessional politics they hv faild totally n the jubilee gvmnt r out 2 take us back 2 s.sudan
Choices have consequences!!!!
It’s very stupid,selfish & arrogant behaviour of kra to vomit such a venom to GOR MAHIA FC ,why is it that after tuzo sponsorship withdrew is when the taxes stories arises? do tuzo want back their money through taxes? let them try elsewhere.
Rachier should hire good Accountants such as PWC to conduct annual statement of accounts and these guys will also enable the club know its tax liabilities in advance.
The only way forward is for Gor to handle its financials with reputable audit and tax consultants since the club will still grow further and be more sophisticated than today.
kra why Gor?do this to other remaing 15 KPL teams.let just prevail.
let EC approach kra n rqst 4 the computations thn plus penalty i wanda if its close 3m n if thr is a slight error then we cn go 2 court
@BABA TRAVIS what you have said is the truth behind this matter and it will not help them if that is there strategy of scattering luos as a community. Gor is the main uniting factor in luo land and even my old father at home always inquires from me how we have performed.I tell you they will collapse with there strategy,Let them proceed on if surely they want peace in kenya.Yes taxes must be paid but are all TPL clubs paying the taxes the way they are claiming if only paying there players is a problem…?These are the people who were claiming that they wanted to build stadiums,then who will play in them if there aim is just to kill some clubs especially the community clubs in kenya..?Let uhuru and his cronies try and kill gor and afc they will not be peaceful ,they are used to stealing votes from RAO every election year and nothing happens so let them carry on with there strategy.They have been scheming on how they can bring some of there people as officials in gor but it has been failing the latest one was Adede and we never accepted him,but this time round i see them catching up with us in the issue of tax but GOD with us.
Amicable solution should be reached to avoid nasty confrontation. Both concerned parties sit and solve the matter and avoid issuing statements which might complicate matters. Tax must be paid by all but within the set policies not selectively as is happening in this country. The gov’t needs tax to run the country and on the other hand the same gov’t needs K’Ogalo to grow Soccer in this country hence the need for both to and come up with a comprehensive solution
What is an accurate population of true Gor Mahia fans. by this I mean people who can contribute a little money to manage Gor. Imagine one million supporters contributing 100 kenya shillings on Mpesa per month. The total amount is 100 million. Gor fans, let us mobilise ourselves and rescue Gor. With 50 million shillings per month, we will be able to sign and pay the best players in Kenya and Africa.
This issue needs to be addressed in a sober manner by both parties. Indeed all must pay taxes including our beloved club. For sure PAYE must be paid by players but probably what KRA should do is to come out clearly and expressely state how they arrived at this figures to avoid creating unnecessary tension. This is a country that sees things either politically or ethnically and i wish KRA would not allow themselves to be viewed that way.
On a positive note this issue will drive our club to start running itself in a more professional manner. For sure the EC is bloated and must be trimmed to a manageable level (too many assistant this and that). If i was asked i wld just the Chair, Secretary and Treasurer with their assistants. After trimming we need to urgently constitute a proffessional secretariate to handle issues of Finance, HR & Admin, PR etc on a 3 year renewable contract. Finally we must engage a good Audit firm to audit our accounts. Otherwise the truth will be lost under all the emotions being exhibited.
Just sent my contribution through the pay bill number 350100.It’s honour to be called upon to help my beloved club.Adversity is the mother of all inventions.
Let’s turn this lemon into a lemonade.
Both sides are to blame for the Tax issue. Am sure EC were aware of this notice and either swept it under the carpet or took too long to conjure up the figures. How many businesses do we see ‘paying up’ something small to avoid the full tax obligation but end up looking clean!!! Am sure somebody at Gor refused this option hence the huge bill!!! KRA is corrupt, everyone knows. But EC must wake up and start doing things the correct way. Declare all gate collections and publish all accounts. I can see there has been an immediate reaction and a pay bill number has been circulated instantly! Sure adversity brings out the best in us, let’s take advantage of this crisis to institute the right culture in the club. Lets account for all the moneys we will contribute and use it to pay our players well as as attract the best talent. Let’s kick out hooligans and augment collections at the gate to the kitty. Together we will build this club to the highest level where it belongs!!!
This is what I think must be done: A breakdown of the assessment must be availed to the club if that has not been done.
Secondly, all the other fifteen TPL clubs and other second tier clubs should be assessed in the same way,no less.
Taxes must be paid where correctly due but KRA needs to make clear their interest in this matter especially considering that they also have a team competing at this level; let them withdraw that team immediately to avoid issues of conflict of interest
Is Gor Mahia an amateur sports club? how are they registered? someone please clarify coz this might just see them escape corporate tax
Even if it is about paying tax & assuming that Gor did not pay taxes from 2010 & that is 3 yrs.even if our taxas were 20 million/yr it will mean that the KRA needs 60 million & that will mean that Gor’s turnover is more than 100million/yr.How did KRA arrive at that figure? I think that there is polytics in this issue.
Can someone tell me the other no. that we use after paybill no.
I can see most people here agree taxes must be paid!
A lot have been said before about running the club in a professional way.
I would have wished we view the truth soberly than rushing to side shows. Remember ignorance of law is no defense.
I also don’t think AR will be chair for the rest of our lives and will be replaced somehow by someone.
The tax issue could have been avoided or sorted out quietly without hot reactions in the media had AR attempted to professionalize management of the club even for three years of the six years he has been the chair.
But anyway abuses and labellings will not help GM out of this, humility and negotiations will.
I am not ashamed to mention that even the likes of Dr. Adede could still be approached to help GM secure sponsorship and/finances, Gor Mahia the man after whom the club was named (Gor Mahia the grandchild of Ogalo) is not father to us hence we can not exclude anyone in its building.
@Kassim AR is not the problem. The club has an archaic constitution. Instead of all these EC members, we should have full time employees like accountants and general managers.
Guys, KRA has crippled many organizations coz of assumptions of the ethics and procedure. We are not above the Law, and we’ve been caught pants down. I’ve seen them guys (kra) cripple a friend economically. All we need is discipline in our affairs to avoid giving them a reason to destroy us. Jesus said give to …. so that we can stick to our core business of football. 1st get tax consultants to confirm our accounts if this amount is logical, 2nd after then discuss how to pay this in installments, 3rd maintain a clear records and 4th always file our returns.
This is what happens when you pay players throgh a bahasha. Any monies that Gor raises for their players through pay bill will also be confesticated unless Rachier stuffs it in his mattress.
All employers are acting as KRA agents when it comes to payments to their employees salary and allowances. Employers have a duty to remit PAYE and fill returns by 10th of the preceeding month, failure to which, penalties and interest will arise. Income Tax Act Cap. 470 3(2)(a)(ii) pg 27 alongside pg 31. Also check on PAYE guide on duties of employer.
Gor Mahia being a society, it has an obligation of paying taxes on their fees income.
…… If Gor Mahia have not been remitting PAYE, they have a penalty of Kshs 10,000 per month alongside a 2% interest and actual amount that ought to have been paid. This are the true facts, lets comply with the tax man for the betterment of all of us.