Kenya and the Czech Republic have signed a new agreement aimed at scrapping double taxation on businesses operating between the two countries.
The deal was sealed on Tuesday, September 23, at a ceremony in Nairobi where Treasury Cabinet Secretary John Mbadi and Czech Ambassador Nicol Adamcová put pen to paper. Treasury officials, diplomats, the Kenya Revenue Authority, and the Attorney General’s office were also present.
The arrangement means companies will no longer be taxed twice on the same income. Previously, a Kenyan firm with operations in the Czech Republic could be required to pay tax in both countries.
Under the new rules, only one country will levy the tax depending on where the business has a permanent office.
Mbadi said the pact will give investors more certainty while curbing tax avoidance. He also described it as a step forward in strengthening ties with the Czech Republic.
Kenya now has double taxation agreements with 15 other countries, among them Canada, Germany, India, South Africa and the UK.
Treasury says such treaties remove unnecessary hurdles to trade and investment by ensuring businesses are not unfairly taxed in multiple jurisdictions.
