I was reading the Nation the other day and was quite shocked to discover that once again, the tax man is coming for someone else.
‘The Kenya Revenue Authority (KRA) has set its sights on developers of income-generating digital applications (apps) as part of wider plans to rope online businesses into the tax net.
The app developers are staring at tax demands on downloads on their platforms and resultant revenue, the taxman announced Wednesday.
KRA says it will work with the Communications Authority of Kenya (CA) to obtain transactions data by resident and foreign-based app developers doing business in Kenya.’ (the East African)
This, apparently, will lead to platforms like YouTube and Netflix being taxed in Kenya.
On the one hand, I see the sense in taxing multimillion dollar global corporations for the money that they are making in Kenya, tax-free. Of course if Kenyans are using the product, and they are making money from Kenyans, then it makes sense to give the money to the Kenyan government, no?
The same has been done in several countries all over the world, such as France, who recently put a three percent tax levy on something similar. Uganda just did it as well, in a misguided manner that taxed the citizens for using digital platforms like Facebook, and that led to a third or so of internet users in Uganda falling off Facebook and the internet completely – because surely, the approximately Sh200 tax being levied is about how much a typical Kenyan user would use in four days, assuming one is buying bundles – even less if one is not a heavy user, or watching too many videos.