Kenya plans to sign an agreement with China to end double taxation, The Nation newspaper reported.
The deal, subject to ratification by the Chinese and Kenyan governments, will create a conducive environment for investment and trade in goods and services.
Kenya’s National Treasury Cabinet Secretary Ukur Yatani has sought citizens’ views before the deal is signed.
The recent statistics released by the Kenya National Bureau of Statistics (KNBS) showed the country’s trade deficit with China widened to 425.17 billion Shillings in the year through March 2022 from 370.58 billion Shillings a year ago, a 15% jump.
Moreover, China is also Kenya’s second-largest external lender after the World Bank, the newspaper said. By the end of May this year, Kenya owed 1.19 trillion Shillings to the World Bank and 796.46 billion Shillings to China.
A review of the intended double taxation agreement (DTA) between Nairobi and Beijing will focus on trade and investment, education and research, and sports.
The DTA will also see Chinese firms paying income tax on their business in Kenya get a reprieve from paying the same tax in their home country. The same will apply to local firms doing business in China.
Kenya has already concluded new double-tax treaties with trade partners such as the East African Community and the UAE.
(Editing by Seban Scaria email@example.com)