NIFC mulls tax dispute solving hub
Nairobi International Financial Centre (NIFC) is eyeing a parallel tax dispute resolution centre in an attempt to create transparency and predictability to attract investors ahead of its official launch next week.
A dispute court within the centre will enable NIFC to be staffed with judges who are well-versed in matters of financial frauds, tax cheats, and other disputes in fintech, blockchain, climate finance, and carbon trading.
“If we can work with the judiciary and government to see how we can create a more efficient financial services and technology court, I think that we will put ourselves in a much better position because dispute resolution is going to be key,” Oscar Njuguna, NIFC chief executive said.
Commercial disputes
If adopted, it means that both domestic and foregn firms signed under the NIFC regulations will have a right to bypass KRA’s resolution process and High Court in the event of tax bill scrutiny. The internal dispute centre will, however, be anchored on a similar framework such as the Nairobi Center for International Arbitration which handles commercial disputes.
The centre aims at catalysing investment in the country, create employment, and promote growth of domestic firms in cross-border trade. The financial centre, which is still housed at the National Treasury building, currently operates with eight staff members as its eyes pull in foreign investors who are seemingly cautious of emerging markets and unpredictable operation environments.
Kenya’s tax arbitration process often locks out cases which are criminal in nature like fraud, tax cheats, and other financial malpractices, informing KRA’s massive shift to technological surveillance and reliance with foreign countries to seal revenue leaks.
“The arbitration framework within KRA seems to be working well so there is no reason why that cannot continue but here we are talking about a real court,” said Njuguna.
“On dispute resolution specifically, that is something we recognise has to be done differently. We have to create a tailored court for the financial sector and probably for technology as well,” he added.
