On January 2, 2021, the Kenya Revenue Authority (KRA) effected the digital service tax that will see traders taxed on gross transaction value.
The tax, among other things, will be charged on subscription based media including online news and magazines subscriptions as well as online ticketing services. Mobile apps, ebooks and films will also be sbject to the tax.
Below is a list of the items that will be subject to the tax.
- Streaming services for TV shows, films, music, podcasts and other available digital content.
- Provision of search engine services, chatbots, remote support, instant feedback services and customized search engine services.
- Licensing, sales and other forms of monetizing data collected from Kenyan users.
- Online training delivered through pre-recorded media or e-learning platforms and courses.
- Any services provided through the digital marketplace.
Foreign exchange services provided by a licensed financial institution or financial services provider will however be exempted from the tax.
The tax will not be charged on services that facilitate for payment of services, lending, trading of financial instruments and commodities.