Paving the way for greater tax transparency in Kenya
Paving the way for greater tax transparency in Kenya
On 17 August 2017, Nigeria joined the close to a hundred countries that have signed up to the Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base Erosion and Profit Shifting (MLI). The MLI in simple terms, is a multilateral treaty whose objective is to amend the more than 3,000 double tax avoidance agreements (DTAs) in one fell swoop.
In an ideal world, nobody likes paying taxes, let alone paying more taxes that one ought to pay. This is without a doubt one of the reasons why failure to pay taxes attracts stiff penalties. DTAs therefore serve the useful purpose of eliminating the possibility of taxing the same income twice.
Though the oldest DTAs were first introduced in the late 1870s, it was not until after the USA great depression of 1929 that DTA use expanded. Today, there are more than 3,000 DTAs globally. Kenya itself has in the last 10 years doubled its DTAs.
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