The Kenyan government is planning to exclude all startups in Kenya from the recently implemented 1.5 percent digital tax. The decision is seen by observers, as a direct response to complaints from entrepreneurs in Kenya.
According to reports by the Kenya Broadcasting Corporation (KBC), the Kenyan government is considering carrying out amendments to the Finance Act 2020 that will essentially remove the 1.5 percent digital tax obligation of local businesses who utilize digital marketplaces as a means to generate revenue for themselves.
The Cabinet Secretary for ICT, Innovations and Youth Affairs; Joe Mucheru has made it known that the Digital Tax is aimed at multinational players with operatons in Kenya, who do not pay corporate tax. He reiterated that conversations are underway to exclude entrepreneurs from the 1.5 percent digital tax.
He added that the Kenyan government intends to make amendments to the ICT practitioner bill in order to effectively protect startups from the digital tax.
According to the Kenyan Wallstreet the Digital Tax will require all online businesses that do not have any presence in Kenya, to employ tax representatives to represent them in Kenya. This will help said online business to meet or rather fulfil their tax obligations within the country. This includes includes multinational establishments like Apple Music and Netflix, who do not have permanent physical set ups in Kenya.
Are there any other topics, news or categories that you would like us to write on? Feel free to reach out to Mpesa Pay in the comment section.
