NAIROBI, Kenya — The Kenya Human Rights Commission (KHRC) has renewed calls for mandatory public revenue disclosures by multinational corporations, warning that aggressive tax avoidance is draining billions of shillings needed for schools, hospitals and other essential public services.
The demand follows a landmark ruling by the Tax Appeals Tribunal, which dismissed an appeal by a multinational firm and upheld a Sh1.76 billion tax assessment issued by the Kenya Revenue Authority (KRA).
KHRC says the decision validates long-standing concerns over corporate tax abuse in Kenya.
“This ruling matters not just for tax reasons, but because it confirms a problem we have raised repeatedly,” the commission said, arguing that large multinational firms often use complex internal transactions to shift profits and minimise their tax obligations.
According to the commission, such practices deny the state crucial revenue and shift the tax burden to ordinary Kenyans through higher value-added tax, pay-as-you-earn deductions and levies on basic goods and services.
KHRC illustrated the impact of the disputed Sh1.76 billion, saying the amount could fund 1,760 public school classrooms, eight fully equipped county hospitals, nearly 29 kilometres of tarmacked road, or pay more than 3,500 nurses or teachers for a year.
It could also support several rural and peri-urban water projects.
“These comparisons show the real cost citizens bear when taxes are contested or avoided,” the commission said.
The tribunal’s findings, KHRC added, confirmed that KRA was justified in questioning the multinational’s related-party transactions and profit margins.
The outcome, it said, reinforces conclusions in its publication Who Owns Kenya?, which links corporate tax abuse to widening inequality and underfunded public services.
“When revenue is lost through tax avoidance, children sit in overcrowded classrooms, patients go without medicine and communities lack clean water,” the commission noted, warning that corporate tax evasion weakens the state’s capacity to deliver basic services.
Building on the ruling, KHRC revealed it is now examining other corporations, focusing on the land they occupy, the terms of their leases, and what they pay in land rates and taxes.
Early findings, it warned, suggest the scale of revenue loss could “shock many Kenyans,” especially as households struggle with rising taxes and the cost of living.
To curb profit shifting, the commission is calling for country-by-country public reporting by multinational corporations, requiring disclosure of revenues, profits, taxes paid, number of employees and assets in every jurisdiction where they operate.
“Such transparency would make it harder to conceal the true tax base,” KHRC said, adding that it was time to end what it described as the looting of public resources through aggressive tax practices.
The commission also challenged the National Treasury to spell out concrete measures it is taking to hold multinationals accountable beyond isolated court cases.
It urged KRA to introduce annual transfer pricing audits in high-risk sectors, including agribusiness, extractives, manufacturing, energy and digital services.
Where aggressive tax avoidance is proven, KHRC said penalties should go beyond recovery of tax and interest to include punitive fines and possible criminal investigations.
Among additional proposals, the commission called for restrictions on deductions for related-party fees unless there is clear economic substance, publication of the largest corporate taxpayers and major tax disputes, and the creation of a public register linking large landholdings to tax records.
It also pushed for tougher action against treaty shopping through low-tax jurisdictions and the denial of incentives or state support to companies with a history of tax avoidance.
Taken together, KHRC said the measures would ensure firms benefiting from Kenya’s resources contribute fairly to national development rather than shifting the burden onto citizens.
