This archive report was first published on 15 August 2019.
August 15, 2019
The Kenyan government is in the final stages of developing a framework to tax foreign online streaming media services, including YouTube and Netflix.
According to Communications Authority director-general Francis Wangusi, the over-the-top services (OTT) will soon be required to declare the incomes they derive from Kenyan consumers.
OTT services include all applications that offer voice and messaging services over the internet.
Mr. Wangusi stated that online content providers exploit the Kenyan industry, yet neither the government nor artistes benefit from them.
“Many countries, especially developed ones, have policies that guide these services, and that is where we are heading to as a country,” Mr. Wangusi said, adding that traditional distribution channels have been weakened.
He emphasized that technologies to facilitate taxation of OTT services are available.
“I believe the OTTs will declare the correct revenues, considering that the international community is also watching them,” Mr. Wangusi said, adding that once a policy is developed, the government will have grounds to shut down those that will not adhere to the rules.
The proposed policy framework will also ensure that foreign advertisements airing in the Kenyan market are subjected to taxation.
Additionally, the Kenya Revenue Authority (KRA) has announced plans to collaborate with CA to introduce VAT obligations for app developers trading in Kenya.
Mr. Wangusi also emphasized the importance of online safety, urging parents and teachers to encourage young people to seek help from the right authorities when faced with online risks and vulnerabilities.
