Kenya Revenue Authority (KRA) has announced that social media influencers are not exempted from paying the 1.5% Digital Tax.
The Taxman said that Social media influencers will be liable to pay digital service tax since their income is derived from or accrued from the provision of services through a digital marketplace or by providing digital advertising services in Kenya.
Social media influencers will be liable to pay digital service tax since their income is derived from or accrued from the provision of services through a digital marketplace or by providing digital advertising services in Kenya.
— KRA Care (@KRACare) January 18, 2021
This follows the Finance Act recently signed into law by President Uhuru Kenyatta which seeks to broaden the Income Tax Act net to include the income accruing through the digital market place.
The Finance Act 2020 stated that the exchequer anticipates raising KES 2 Billion from the Digital Service Tax which will apply to a wide range of digital services that individuals and businesses consume every day.
The law also applies to;
- Streaming and downloadable services of digital content.
- Transmission of data collected about users which have been generated from such users’ activities on a digital marketplace, however, monetized.
- Digital marketplace, website or other online applications that link buyers and sellers.
- Subscription-based media including news, magazines and journals.
- Electronic data management including website hosting, online data warehousing, file-sharing and cloud storage services.
- Supply of search-engine and automated helpdesk services including supply of customized search engine services.
- Tickets bought for live events, theatres, restaurants etc. purchased through the internet.
- Online distance teaching via pre-recorded medium or eLearning, including online courses.