Kenya Revenue Authority has announced tax amnesty for Kenyans with investments in foreign countries, a move that is likely to unlock billions of shillings stashed
In a statement dispatched to media houses, the tax man gave Kenyans up to the last day of this year to declare taxable incomes earned outside the country.
“KRA wishes to notify the public that a tax amnesty has been granted through Finance Act 2016 to all persons who will declare taxable incomes earned outside Kenya for the year of income ending on or before December 31, 2016,’’ read the notice.
The tax authority was however quick to clarify that not all individuals will benefit from this amnesty.
“Any person who is currently under a tax audit or investigation on a matter of non-disclosure of income or an assessment has been issued to where tax interests and penalties are due does not qualify for the amnesty
This amnesty comes at the time various sources are indicating that rich individuals hiding up to 30 per cent of accumulated wealth in various tax havens across the world.
According to a New World Wealth report released mid this year, total amount of money hidden in foreign deposits by wealthy Kenyans is enough to fund almost a half of the country’s 2016/2017 budget.
If returned, the amount is able to fund several infrastructural projects, cautioning the country from accumulating foreign debt
A detailed expose by International Consortium of Investigative Journalists early this year showed that the some super rich individuals were hiding at least $32 trillion in offshore accounts.
Dubbed Panama Papers, the detailed country by country report showed that the use of tax havens had increased by 25 per cent from 2009 to 2015.
Many Kenyan companies also stash their incomes abroad through shell companies registered in Mauritius and Seychelles.
Experts are however divided on this amnesty issue, with some saying that the amnesty will encourage the vice.
Others are optimistic that the waiver will see money brought back to the country, hence fueling the economy.