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Civil groups in court over tax treaties dispute

AZez

Sept. 28, 2020

Civil groups in court over tax treaties dispute
In summary
LAUNDERING: Civil society groups, Tax Justice Network Africa and Katiba Institute have moved to High Court to oppose Double Taxation Agreements (DTAs) Kenya signed with 10 countries.
In their petition, the civil society groups argue that the countries in question, Iran, Kuwait, Seychelles, South Africa, Qatar; Korea, the United Arab Emirates (UAE), India, the Netherlands and Mauritius with existing DTAs with Kenya are being used by certain companies for money laundering to avoid paying taxes in the country.
“Questions surrounding DTAs need to be urgently addressed in a decisive manner.
This is especially the case if one is to consider the recent revelations concerning how Kenyan companies abuse DTAs to avoid paying taxes in the country,” the statement reads in part.
Double taxation Agreements are treaties signed between two or more countries to avoid paying double taxes and levies on the same income, asset or financial transaction.
Main aim of DTA is to divide the right of taxation between the contracting countries, to avoid differences, to ensure taxpayers’ equal rights and security, and to prevent evasion of taxation.
The malicious practice is said to be rampant among Kenyan companies with operations in the above mentioned jurisdictions.
The US department of Treasury is also believed to be examining allegations that 53 Kenyan companies took part in high level financial crimes and money laundering activities to the tune of an estimated $60 billion (Sh6.5 trillion), according to revelations by Tax Justice Network Africa.
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