The Kenya Revenue Authority has come out guns blazing demanding taxes from online traders. In a public statement, KRA said that some digital businesses do not charge Value Added Tax (VAT) on transactions made through their platforms.
Further, the Commissioner for Domestic Taxes noted that digital market place owners and persons trading through these platforms have failed to file their tax obligations.
In this case, the taxman informed online traders that under the VAT Act 2013 they are required to charge and remit VAT on:
- All sales made through their digital platforms
- The commission charged to the vendors for the use of their digital platforms to transact
Online trading platforms have increased in Kenya as consumers seek online shopping experiences. On social media pages, Twitter, Facebook, and Instagram enterprising Kenyans have been selling electronics, beauty products, furniture, and phones.