A newly released report indicates that wealthy Kenyans are hiding a whopping Sh457 billion in offshore accounts.
The funds, which are stashed in low tax territories, represent 4.8 percent of Kenya’s Gross Domestic Product (GDP), according to the State of Tax Justice 2020 report released by the Tax Justice Network and Global Alliance.
The report notes that this has denied the country $63.4 million (Sh6.9 billion) in tax revenues.
A World Bank report released in March this year revealed that Kenya’s political elites who served under Moi and Kibaki administrations looted over Sh327.89 billion and stashed the money in offshore accounts.
The elites plundered the cash directly from foreign aid or through kickbacks from State agencies that received donor funding, according to the report titled “Elite Capture of Foreign Aid: Evidence from Offshore Bank Accounts.”
Kenya ranks second in the amount of stolen donor funds hidden overseas, behind Jordan which had Sh350 billion stashed abroad. Ivory Coast came third with Sh128 billion followed by the Democratic Republic of Congo (Sh110 billion).
The report indicates that most of the looted funds are hoarded in countries that have laws that guarantee secrecy and encourage tax evasion. They include Switzerland, Luxembourg, the Cayman Islands, and Singapore.
Other funds are hidden non-havens including Germany, France, and Sweden, the report notes.
Out of the Sh327 billion looted in Kenya, Sh136.2 billion is hidden in tax havens while Sh190.35 billion is deposited in regulated bank accounts.