Kenya will now be able to pursue individuals who use offshore companies to evade taxes and commit other economic crimes, after it signed the Multilateral Convention on Mutual Administrative Assistance in Tax Matters last week.
The agreement is the most comprehensive multilateral instrument available for all forms of cooperation to tackle tax evasion and avoidance.
It provides for exchange of information on request and assistance in tax collection, among other things.
Kenya’s ambassador to France Salma Ahmed signed the convention in the presence of the Organisation for Economic Cooperation and Development Deputy Secretary General Douglas Frantz, committing to exchange information that would help governments to collect revenue domestically. Kenya becomes the 12th African country to sign the pact and the 94th to join it.
“This is part of our commitment to reduce the scope of tax avoidance and evasion through up-scaling use of electronic data matching and third party information. This commitment is a key plank in our KRA 6th Corporate Plan that was unveiled late last year to facilitate the authority’s transformation to an efficient national tax administration agency,” Kenya Revenue Authority Commissioner General Douglas Frantz told the Nation.
The convention will not only make it possible to reveal the names of tax evaders, but also make it easier for the government to pursue them within and outside the country.