A report by Business Daily on Monday, January 11, indicated that the taxman had registered businesses that fall under the Digital Service Tax (DST) that was launched on January 1.
KRA also noted that it was banking on the Covid-19 disruptions to cash in on the new digital age after most businesses developed their digital fronts.
The institution is targeting to make as much as Ksh5 billion in the six months to June 2021.
“The uptake of Digital Service Tax (DST) has been incredibly positive by both resident and non-resident persons operating in the digital market.
“KRA is estimating more than 1,000 businesses to register and account for DST,” read the statement from KRA.
Some of the businesses targeted by the taxman in the new bracket include subscription media such as news, magazines and digital content as well as movies and online shops.
Digital Service Tax (DST) is payable on income derived or accrued in Kenya from services offered through a digital marketplace.
Individuals and companies offering digital services are now expected to pay 1.5 per cent of their gross transaction value as DST as from January 1.
KRA has previously stated that the tax shall be due on or before the 20th day of the month the digital service was offered.
The digital tax will be applicable to all digital platforms enabling direct interaction between buyers and sellers of goods through electronic means in the country.
In addition to the DST, service providers will also be required to pay Value Added Tax (VAT) on digital supplies. The gross transaction value is exclusive of VAT.
The taxman is looking to hit 100 new registrations from non-residents by the end of this week.
DST will be applicable for both business to business (B2B) and business to consumer (B2C) transactions.
Source: KENYAGIST.COM
