Kenya Set To Tax Cryptocurrency Exchanges.

Kenya Set To Tax Cryptocurrency Exchanges.
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    Report from a Kenyan local news outfit revealed that the Kenyan Treasury will start levying taxes on revenues earned by cryptocurrency exchanges used by an estimated 4 million Kenyans.  According to a report by Business Daily Africa, Kenyan authorities will rely on the 1.5% digital tax service that became effective on Jan.1, 2021.

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    Initially proposed in 2020, the digital tax is the Kenyan government’s attempt to extract revenue from leading crypto exchanges and tax-avoiding digital asset platforms. As reported by News in early January 2021, the Kenya Revenue Authority (KRA) said it expected to get $45.5 million (5 billion Kenyan shillings) from the tax.

    Meanwhile, as shown in the 2023 regulations’ value added tax (electronic, internet and digital marketplace supply) published by Treasury Cabinet Secretary Njuguna Ndung’u, Kenya can now target global crypto exchanges.

    “For the purposes of these Regulations, a taxable electronic, Internet or digital marketplace supply include…facilitation of online payment for, exchange or transfer of digital assets excluding services exempted under the Act,” the published regulations state.

    Also Read: Central African Republic Rated Among Top 5 Best Countries With Low Crypto Taxation.

    Alongside Nigeria and South Africa, Kenya has one of Africa’s highest proportions of the population owning crypto. However, like its peers on the continent, Kenya has not recognized cryptocurrencies. The Central Bank of Kenya (CBK) and its governor have warned residents against dealing with crypto assets like bitcoin.

    Despite the warnings, Kenyan residents continue to acquire and trade cryptocurrencies and this has prompted the government to seek ways to levy taxes on crypto transactions.

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