The Kenyan government may soon start to tax online streaming services. The ICT ministry says it’s in the final stages of developing a framework that will be used to tax the foreign services.
Over-the-top services (OTT)such as YouTube and Netflix will soon be required to declare the incomes they derive from Kenyan consumers and start paying tax.CA director-general Francis Wangusi said online content providers exploit the Kenyan industry yet neither the government nor artistes benefit from them.
OTT services include all applications that offer voice and messaging services over the internet.
The proposed policy framework will ensure that foreign advertisements that air in the Kenyan market are subjected to taxation.
Already, the Kenya Revenue Authority (KRA) has announced plans to collaborate with CA to introduce VAT obligations for app developers trading in Kenya. KRA is targeting apps with in-app purchases, those that sell goods and services and those that require users to pay before downloading.
Kenya fell short of it’s revenue target by 4% in the 2018/19 financial year. The taxman posted sh1.58 trillion collected revenue as compared to the set target sh 1.8 Trillion.