The Ministry of Finance has notified a revised agreement on double tax evasion (DBAA) between India and Kenya, with a 10% withholding tax on dividends, interest and royalties. and in both cases, conditions different from those that would be achieved between independent companies are imposed or imposed between the two companies in their commercial or financial relations, so that any profits that would be paid to one of the companies, but which have not accumulated as a result of these conditions, can be included in the profits of that business and be taxed accordingly. The revised DBA was integrated to promote existing economic cooperation between Kenya and India, with India being one of the main investors in Kenya. The DBA modernizes the provisions of the previous DBA to be more in line with international developing tax practices and national tax laws applicable to Kenya and India, and offers many incentives, such as reduced withholding rates. 1. States parties assist each other in the collection of revenue fees. This support is not limited by Articles 1 and 2. The competent authorities of the contracting states may, by mutual agreement, regulate the manner in which this article is applied. 1. Legislation in force in none of the contracting states continues to govern the taxation of income in the contracting states concerned, unless this agreement provides for contrary provisions. ii. The revised DBAA provides for a new article on benefit limitation, which allows bonafide contractual benefits for residents of both countries, to combat the misuse of contractual contracts by residents of third countries and to allow the application of national legislation to prevent tax evasion or evasion.
This agreement does not affect the tax privileges of members of diplomatic or consular missions, in accordance with the general rules of international law or the provisions of specific agreements. 4. The agreement also applies to all identical or essentially similar taxes levied after the date of the signing of the agreement, in addition to or in place of existing taxes. The competent authorities of the contracting states inform each other of any substantial changes to their respective tax laws. The revised DBAA will improve tax transparency, help reduce tax evasion and evasion, eliminate double taxation and stimulate the flow of investment, technology and services between India and Kenya.