Why State must crack down on tax dodging companies

Kenya Revenue Authority headquarters Times Tower, Nairobi. [PHOTO: JENIPHER WACHIE/STANDARD]

Revelations that Africa has lost to rich nations as much money as it has received from them in official development assistance over the past 50 years is a damning indictment on the United States of America and United Kingdom. The two countries led a rejection of a push by developing countries to have a say on rules of taxation of international businesses.

The rich nations showed their true colours in a meeting held in Addis Ababa in July, this year, when they rejected the poor countries’ push to be included in the composition of the Organisation of Economic Cooperation and Development (OECD), which develops guidelines for cross-border trade. OECD rules are widely applied in interpreting and solving trade and tax disputes across the world when transactions are across different jurisdictions.