Secrecy Savannah: Is Kenya being Shaped into Africa’s Flagship Tax Haven?

[undeterred]

4 JUNE 2013 - 12:15PM | BY MARTIN KIRK, BLESSOL GATHONI

21-32 trillion has been siphoned off into tax havens, and now there is evidence to suggest the City of London is trying to make Kenya the world's next tax avoidance hub.

If anyone doubted the sheer scale of corporate power and the importance of tax havens to it, they had the unedifying spectacle of Tim Cook, CEO of Apple, to enlighten them last month. In already infamous evidence to a US Senate Committee, Cook demonstrated that the international tax system is broken and big corporations are the last people to fix it. He said outright that he won’t consider repatriating the staggering $100 billion they have hoarded offshore if it means paying standard US corporation tax.

This is just businesses doing what businesses do. Apple are not going to voluntarily take on extra costs, regardless of moral argument, when they do not have to and their competitors are not. The problem is structural, not individual. This is why, if the tax-avoiding instincts of companies like Apple – along with Glencore, Google, Starbucks, and in fact most large multinationals – are to be neutralised, the only thing to do is tackle the system of tax havens that makes every individual example of avoidance possible.

The imperative is overwhelming. Tax havens exist for one purpose only: to provide a way for the rich to get around the taxes that pay for the infrastructure and services on which we – and they – rely. Tax havens have become, over the last 30 years, a key driver of vast inequalities around the world. The system has grown so big that it is now an arterial drain on public budgets everywhere. According to James Henry, ex-Chief Economist of McKinsey, somewhere between $21 and 32 trillion has been siphoned away from the mainstream economy through these means.

Kenya: a future tax secrecy savannah?
The global tax haven system is a network with many parts, and the more parts, the more extensive and powerful the network. 30 years ago, there were a handful of relatively small tax havens, serving a small elite. Today, there are more than 80, and they are a parasite on the mainstream, public economy. There is now mounting evidence that elite financial interests are planning to create a new tax haven – to add another node to the global spider web. This time it is on the African continent, which already gives far more to than it receives from the world economy. According to a recent report from the African Development Bank and Global Financial Integrity, Africa has already lost in the region of $1.4 trillion in illicit financial flows between 1980 and 2009. If successful, this hub will be a key mechanism to extract even more wealth from some of the world’s poorest countries.

read more at: http://thinkafricapress.com/kenya/secrecy-savannah-kenya-being-moulded-be-africa-flagship-tax-haven

[mojowork_n]

1. 30 trillion in protected assets for the wealthiest few...

...and on the other side of the world, the poorest of the poor have no idea why their lives are so unrelentingly difficult.

This came out a week or two ago, the other side of the Kenyan economic picture:

http://www.counterpunch.org/2013/05/24/misery-is-like-a-war/

...you know you are living in a warzone. You know it from the start; you’ve sensed it ever since you were a very little boy or a girl. You wake up every morning, not certain whether you will witness another dusk, whether you will experience another sunrise.

A bullet can hit you at any moment while you are walking down the road. If you are a woman, you can be ambushed and dragged into a dark back alley or filthy shack along the way, then raped.

The police are very hard to find, and are hopelessly corrupt. You prefer not to seek their ‘assistance’. You are really on your own: you own no gun, you don’t belong to a gang, and you are extremely poor.

You are exposed.