Kenya Revenue Authority (KRA) has issued a statement stating that social media influencers will not be exempt from the new Digital Services Tax (DST).
The IRS argued that they also fall under the new tax as they earn by making it easier for online businesses and individuals to generate income.
“Social media influencers will be required to pay a digital services tax because their income is or is derived from providing services through a digital marketplace or providing digital advertising services in Kenya,” KRA said.
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“Please note that an influencer is someone who orders a following through a media platform through the products or services they use or engage in to drive sales or fame,” adds the IRS.
The newly imposed DST went into effect on January 1, 2021, with all resident and non-resident digital service providers providing services in the country to remit their taxes to KRA by the end of each month.
The KRA targets to charge DST on revenue-generating services while Value Added Tax (VAT) charged on goods sold.
“Please note that the tax will be collected and remitted by officers. The Commissioner of Internal Taxes appoints them.” KRA said.
KRA’s new instruction sparked an online debate from netizens, with a larger section lambasting the IRS for the directive.
Some argued that social media influencers in the country ain’t making much, and in some cases pushing the political agenda to question whether politicians themselves should pay the tax.
“But that’s gullible. You tax us when we offer digital services but the platform owners don’t tax us. KRA, your reasoning beats me.
“Why have you never collected stolen money and now attack people who are trying to find something in digital spaces?” Digital strategist Janet Machuka posed.
“Kenyan influencers don’t have any money. You want to finish off the young people of this country,” Bravin Yuri added.
“Also KRA these ‘influencers’ pay withholding tax, they don’t get paid digitally. They then promote a product online, they don’t sell anything. But what do I know It’s not like you can Google that, “another netizen said.
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On January 5, the KRA said it had set a goal of raising around Ksh5 billion on DST. This between January and June 2021.
The tax authorities requires that individuals and businesses offering digital services to pay 1.5% of the value of their gross transaction as DST from January 1.
The tax is due no later than the 20th of the month in which the digital service was offered.