What the Revised Kenyan Financial Bill Proposes for Digital Services

After the surprise move by the president to cut the tax on petroleum from 16pc to 8pc, the bill was revised to reflect additional ‘soft’ taxes on other areas which were not put front and center for Kenyans to scrutinize. Although the president allowed somewhat some breathing room for the already financially wounded Kenyan, more is yet to come. Many people including government supporters were upset by the new financial bill proposal for an increased tax on petroleum However, our woes do not end there.

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In the new reveal of the revised edition of the financial bill 2018, the president has added some new taxes to the bill, to essentially cover the cost of the cut levies on fuel prices. Part of the new proposals made by the president includes increased levies on communication services, which refers to internet services, telephone call charges and even mobile money transactions. The now excise duty on telephone and internet data services will move from the current 10pc to a revamped 15pc.

Going digital gets expensive

Therefore, Kenyans will pay higher rates to place phone calls and use social media as a result. This means that data bundles will cost more, and making phone calls will essentially be saved for emergency calls only to save that extra coin on credit. Leaving internet services on to receive messages sent instantly will now leave Kenyans on a schedule to check their incoming social media messages including WhatsApp in a timely manner to save on data bundles.

The new rates will limit online activity for tech-savvy Kenyans who love strolling on the streets of social media platforms such a Twitter and Instagram, scouting for new stories and trending news. In a way, the voice of Kenyans on social media will be kept to a minimum, leaving trolls talking to themselves on these internet streets.

Mobile Money Transfer

The fee charged for sending and withdrawing cash will go up for the second time. The president has proposed increasing the fees by a solid 8pc. This is from the 12pc currently active to 20pc as proposed. The phrase ‘tuma na ya kutoa’ will get a new lease of life, for those seeking to avoid the extra cost of withdrawing their expected amount. For those making business transactions, or paying domestic employers, or even sending emergency cash to friends and family this will come as an added expense to the already high cost of living. The cost of mobile transactions had already moved from 10pc to 12pc as per the Treasury Cabinet Secretary Henry Rotich’s new budget.

Betting and Gaming

As a surprise, the betting industry has been saved a dramatic blow, and instead, the lucrative Kenyan betting industry will get relief if the president’s new bill is approved. Their proposed new taxes will be reduced to reflect 15pc from the previous 35pc which was a heavy burden to bear. Considering the millions of Kenyans who make daily bets on football games and other sports, it is no surprise the industry has made billionaires from this business. The amount of money the government has collected thus far has also been a huge source of revenue and offset for the country’s debts.

Although SportPesa boss, Ronald had voiced concerns over winners being taxed on their wins, the new bill proposes a 20pc tax on all winners’ cash. In this way, moving the pain from one foot to another. Essentially maintaining the 35pc tax while shifting the burden from the companies to the individual to carry the heavier load. However, this remains hypothetical until the parliament approves of the revised Financial Bill 2018. This could take some time as the members of parliament are still not done with the first financial bill, and have vowed to reject even the revised edition.

They have raised their voices in unison to make a presidential plea for the country’s head of state to return things as they were before.


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