Kenyan Revenue Authority to commence taxing income-generating apps

by | Aug 15, 2019

The Kenyan Revenue Authority (KRA) recently revealed plans to tax owners of income-generating apps that are being used by Kenyans.

A 16% value-added tax (VAT) on the value of commodities purchased will be enforced on developers who own applications with in-app purchases and apps that require you to pay before downloading.

In a business daily report, Maurice Oray, KRA’s Corporate Policy Deputy Commissioner, explains that VAT should be paid on such apps due to the fact that the service provided by the app is not zero-rated or tax-exempt.

“If you are a resident here, you are supposed to pay the taxes the normal way. If you are not a resident but you have an app that’s being used here, your tax representative (a requirement under Section 16 of Tax Procedures Act) must pay your VAT and income tax,” said Maurice Oray.

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The KRA intends to facilitate the collection of taxes by partnering with the Communications Authority of Kenya (CA) to keep a close eye on all digital transactions and hook tax evaders.

Besides the VAT on downloads, local and foreign app owners — firms and individuals alike — will still have to pay income tax on their annual profits.

This report comes alongside some divisive regulations recently issued by various African countries on internet users.


Suggested Read: African governments are strong-arming social media, there will be economic casualties


In April 2018, Tanzania issued a $900 annual licensing fee for bloggers and in later in July 2018, Uganda introduced a social media tax. Uganda also recently implemented a $20 license fee on social media influencers.

Also, the Federal Inland Revenue Service (FIRS) of Nigeria is reportedly planning to introduce a 5% VAT on every online purchase.

The KRA’s plan is currently awaiting approval by the Multilateral Convention on Mutual Administrative Assistance in Tax Matters, a multilateral treaty that enables countries to exchange and get specific data on tax evaders across the world.

The tax authority is also waiting for approval from the country’s National Assembly.

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