Fake Invoice Probe: KRA Says 72 Firms Issued KSh 33.83B in Fake Tax InvoicesFake Invoice Probe: KRA Says 72 Firms Issued KSh 33.83B in Fake Tax Invoices
Key Highlights
- Tax investigators allege that 72 companies issued 62,869 electronic invoices worth KSh 33.83B ($260.61M) between 2020 and 2025, and buyers claimed about KSh 4B ($30.78M) in input VAT on them.
- Fifty-seven investigation files have gone to the Director of Public Prosecutions, which has approved prosecution of 42 individuals, companies and directors, while six suspects have been arrested.
- Several of the companies had not filed returns, ran no genuine operations or could not be found at their registered addresses, and KRA is disabling invoicing devices tied to the scheme.
Kenya's tax authority says 72 companies issued tens of thousands of fake electronic invoices that let buyers claim nearly KSh 4B ($30.78M) in input value added tax, a scheme it says ran from 2020 to 2025.
The Kenya Revenue Authority said the companies issued 62,869 invoices worth KSh 33.83B ($260.61M) through its electronic Tax Invoice Management System, Capital FM reported on 15 October. The invoices carried VAT of KSh 5.37B ($41.37M), and businesses that said they bought goods and services from the companies claimed about KSh 4B in input VAT. The claims are allegations; no court has ruled on them.
Files at the prosecutor's office
KRA sent 57 investigation files to the Office of the Director of Public Prosecutions. The office approved prosecution of 42 individuals, companies and company directors, and six suspects have been arrested.
Investigators found that several of the companies had not filed tax returns, had no genuine operations or could not be found at their registered addresses. They also found links between the companies, electronic devices, phone numbers and the people who generated the invoices.
Some records suggested possible involvement of staff accounts at the authority. Those accounts are now subject to internal and legal processes, KRA said.
What KRA is doing about it
The authority is rejecting unsupported VAT claims, recovering taxes owed and disabling electronic invoicing devices linked to the scheme. It warned that businesses that knowingly use fake invoices to reduce their tax bills could face criminal charges and financial penalties.
The report does not name the companies or any individual, and it does not say how many of the buyers who claimed input VAT acted knowingly. The presumption of innocence applies to everyone named in any future charge.
Why paperwork matters for honest firms
For legitimate businesses, the case shows how much weight records carry in a VAT dispute. As Mwenendo earlier reported, dates and paperwork decide tax fights between Kenyan firms and the authority, and a reported KSh 1.44B VAT ruling raised similar questions about evidence.
Mwenendo's reading is that firms claiming input VAT will need to show that a supplier is a real, filing business before they rely on its invoices. The authority's data matching is also not new: Mwenendo explained how KRA's digital engine links identity to revenue using third-party records.
In Summary
- Who is alleged to be involved?
- 72 companies and the businesses that claimed input VAT on their invoices. No company or individual is named in the report.
- What does KRA allege?
- That the companies issued 62,869 fake electronic invoices worth KSh 33.83B ($260.61M), letting buyers claim about KSh 4B ($30.78M) in input VAT.
- When did it happen?
- Between 2020 and 2025. KRA's findings were reported on 15 October 2026.
- Where is the case being handled?
- Files have gone to the Office of the Director of Public Prosecutions in Kenya, which approved prosecution of 42 individuals, companies and directors.
- Why does it matter?
- Fake invoices let buyers cut their tax bills, and KRA warns that knowing use can bring criminal charges and penalties.
- How did investigators trace it?
- They found links between the companies, electronic devices, phone numbers and the people who generated the invoices, and are disabling the devices involved.