Regular readers of Commsrisk will be aware that African telcos have been plagued by ‘tax audits’ conducted by incompetent clowns who promise to deliver enormous returns to the authorities in exchange for a quick rummage around telco CDRs and a percentage of any money they find. Instead of finding any tax evasion, these so-called auditors usually provide evidence of the gullibility or venality of the civil servants working for the tax authorities. Thankfully, some African journalists are holding government agencies to account. An investigation by TV10 Ganomazima has found that a dodgy Kenyan business called Safaritech was paid UGX15.7bn (USD4.28mn) in addition to the promise of 5 percent of any additional taxes levied on the country’s telcos, despite the company having no registered address and a track record of making dubious audit findings that were later withdrawn.
An earlier investigative report by TechFocus24 highlighted how Safaritech was behind a claim that MTN Ghana had underpaid its taxes by USD730mn. The claim was quickly withdrawn by Ghana’s tax authorities when it became apparent that Safaritech’s analysis was flawed. Safaritech immediately tore down their own website to discourage further scrutiny from the press. They have since refused to answer questions about the location of their offices in any African country, or the location of servers they were obliged to purchase per their contract with Uganda Revenue Agency (URA).
In August, TechFocus24 reported that URA had withdrawn a bill issued to MTN Uganda for UGX280bn (USD76.3mn) in back taxes because it had been based on Safaritech’s frivolous approach to auditing. The Ugandan Head of Revenue Intelligence, Brendan Adiru Wadri, was said to have warned Ugandan President Yoweri Museveni not to engage the services of Safaritech. Now the TV10 Ganomazima is going one step further, accusing the authorities of signing a deal with Safaritech that was “deliberately designed to facilitate fraud”.
