(PHOTO CREDITS: Courtesy THE STAR)

A picture has been making the rounds on social media of a man fetching water in a meshed laundry hamper. The picture must have been taken early in the morning by the demeanour of the man and his long shadow. It shows water running into the hamper and spilling even faster while the man patiently waits for it to fill.

This is a simple illustration of what Illicit Financial Flows (IFFs) do to developing countries as they pursue economic growth. IFFs are illegal movements of money from one country to another in contravention of national and international laws.

Undeniably, Africa desires economic growth and it reaches out for foreign aid but the amount of money lost in the process through IFFs is enormous and increasing. It is estimated that developing countries lose six times more through IFFs than what they receive in Official Development Assistance (ODA). The ODA is government aid designed to promote the economic development and welfare of Third World countries.

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(PHOTO CREDITS: Courtesy THE STAR)

When it comes to minerals, Africa is a land of contrasts. According to a World Bank report, Africa is home to 30 per cent of the world’s mineral reserves, 10 per cent of the world’s oil and 80 per cent of the world’s gas.

Yet, despite such enormous resources, the continent’s poverty rate stands at 41 per cent. And out of the world’s 28 poorest countries, 27 are in Africa, all with a poverty rate above 30 per cent.

While mining countries appear to fare better than other countries abroad, this is not the case in most resource-rich countries in Africa.

Kenya sits on a number of minerals, including gas and oil, that are increasingly being exploited. The country has proven deposits of titanium, coal and gold. The government has also been pursuing the possibility of constructing a coal power plant. Despite these resources, few people have benefited.

(PHOTO CREDITS: Courtesy THE STAR)

Kenyan tax system still has complexities with unfair taxes against women, East Africa Tax and Governance Network has said.

The lobby group has established that there exist marked inequalities brought about by factors including consumption patterns, property rights and asset ownership and the tax regime bringing about the injustice. 

The gender bias has also included procedure for filling income taxes or the differences in income tax reliefs.

“Generally, women spend most of their income on consumption of food and other basic services, as opposed to men, hence they carry a greater VAT burden especially on commodities such as milk, bread and wheat flour,” EATGN said.

(PHOTO CREDITS: Courtesy THE EAST AFRICAN)

Seven years ago, Kenya signed a Double Taxation Avoidance Agreement (DTAA) with Mauritius in the quest to promote foreign direct investment (FDI) flows into the East African nation.

The agreement sought to put the competitiveness of Kenyan companies at par with those of other African countries that already had tax treaties with Mauritius and to streamline tax effectiveness.

On analysing the treaty, Tax Justice Network Africa (TJNA), a pan-African research and advocacy organisation, had a contrary opinion to claims of mutual benefits for both governments.

Tax Justice Network found that the DTAA would undermine tax revenue mobilisation while delivering little benefit on the competitiveness front.

(PHOTO CREDITS: Courtesy DAILY NATION)

In the State of the Nation address on Thursday, President Kenyatta vowed to continue the war on corruption.

This would ensure development and justice by protecting public resources from mismanagement and plunder.

Prior to the speech, he President had made a strongly-worded statement that rich Kenyans, whose lifestyles do not reflect their tax returns, should disclose their sources of wealth.

Both statements point to growing inclinations by the national government to work towards tax justice in collaboration with other ongoing initiatives such as anti-corruption, anti-money laundering and counter-terrorism financing.

(PHOTO CREDITS: Courtesy DAILY NATION)

Last week’s terrorist attack in Nairobi provides an opportunity to strengthen Kenya’s anti-money laundering and counter-terrorism financing (AML/CTF) frameworks.

Then, President Uhuru Kenyatta promised that security agencies “ … will seek out every person that was involved in the funding, planning and execution of this heinous act”.

Recall that, on Jamhuri Day, last year, he said his government was keen to prevent illicit financial flows.

Money laundering and terrorism financing are major elements in the execution of terrorist plots.

(PHOTO CREDITS: Courtesy THE STANDARD)

Lobby groups have played down the recent new tax measures unveiled by Treasury, saying it was unlikely to grow government revenue.According to the Institute of Public Finance Kenya and the East African Tax and Governance Network (EATGN), the new Income Tax Bill might be unveiled by Cabinet Secretary Henry Rotich sticks to old models of raising revenues that only tend to protect the rich, but are punitive to the poor and small businesses.The tax lobbies reckoned that Treasury should give poor Kenyans and small and medium enterprises breathing room and instead tax the rich as well as exploring modalities of roping digital companies into the tax bracket.

(PHOTO CREDITS: Courtesy DAILY NATION)

Recent revelations of corruption in State institutions has drawn massive citizen indignation as details on the scale and magnitude in new incidents of public theft continue to emerge.

News of the second scandal at the National Youth Service (NYS), coupled with other reports such as the nefarious maize and fertiliser issues at the National Cereals and Produce Board (NCPB), payment irregularities at Kenya Power and controversial tenders at Kenya Pipeline Company, among others, are enraging Kenyans.

This has resulted in growing resentment towards financial institutions, which are being viewed as major accomplices to mega corruption on account of being conduits for stolen public funds.