Effect of Base Erosion and Profit Shifting On Corporation Tax Performance, A Case of Multinational Enterprises in Kenya
Abstract
The Revenue performance against the set target has been a big challenge. To overcome this revenue gap there is need to shift focus and look at the contemporary issues such as Base Erosion and Profit Shifting (BEPS) that affect Corporate Tax performance across the borders and beyond. Against this backdrop the present study sought to establish the effect of Base Erosion and Profit Shifting on Corporation Tax performance with reference to Multinational Enterprises in Kenya. More specifically, the study sought to establish the correlation between Corporation Tax performance and Base Erosion and Profit Shifting; establish extent of Base Erosion and Profit Shifting by Multinational Enterprises in Kenya; determine the factors that influence the Differential Tax Rate in Kenya; and to establish the challenges facing Kenya Revenue Authority on dealing with BEPS. Descriptive research design was used in the study. The population of interest consisted of staff members working in the Kenya Revenue Authority in Nairobi, mainly Large Taxpayer Office and Medium Taxpayer Office. The population was divided into strata based on the industry and the recommended sample size shall be 42 respondents thus the whole population was used to give the intended data. The main technique applied by the study was of the questionnaires which was issued to the respondents and given enough time to answer the questionnaires. Open ended and close-ended questions were used during the exercise.