For the 13th year in a row, the Kenya Revenue Authority named Safaricom as the top taxpayer in Kenya in 2020. The leading telecommunications company paid KSh106 billion in duties, taxes, and license fees to the government of Kenya for the financial year that ended on 31st March 2021 according to its latest annual report. The payment was equivalent to 40% of its total revenue which stood at KSh264 billion at the end of the financial year.
Since its inception in 2000, the telecommunications company has paid the Kenyan government KSh915.42 billion in taxes and license fees.
In April last year, the Kenyan government introduced a change in the tax law which reduced the corporate tax rate from 30% to 25%. The new tax rate took effect from April to December 2020. Due to the temporary change in the tax law, Safaricom’s income tax expense for the year ended 31st March 2021 fell to KSh24.96 billion from the KSh32.12 billion in 2020, a 22% drop.
According to Safaricom’s latest annual report, the capital expenditure for the year that just ended amounted to KSh 34.96 billion, 3.2% lower than the money spent in the previous year. KSh23.77 billion (68%) of the capital expenditure went into expansion projects while KSh11.18 billion (32%) went to maintenance. The company expects to spend between KSh40 billion and KSh43 billion in capital expenditure in Kenya during the current financial year.
Beyond the Kenyan borders, Safaricom is preparing to roll out operations in Ethiopia after a successful bid for the telecommunications licence in the fastest growing East African nation.
“We are in the process of setting up operations in Ethiopia, to offer the Ethiopian people a world-class network experience as well as transfer the mobile money benefits and experience learned here to that country,” the telco said in its 2021 annual report.