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Google Introduces 16% VAT For Apps and In-App Purchases on Android

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Google Tax

With the recent hike in fuel prices, a lot of questions are being asked as to why the prices keep spiking. One thing that stood out was the taxes being added to the oh so precious commodity. Unfortunately for Kenyans, the taxes keep piling up. Now you’ll have to pay a 16% VAT Tax for Apps on Google Play, Android.

Google Introduces VAT Tax For Apps and In-App Purchases

In-line with tax changes that the Kenya Revenue Authority (KRA) implemented from January 2021 users have received emails stating that Google will implement some changes. Below is an excerpt of the email:

Google is now responsible for determining, charging, and remitting 16% VAT for Google Play Store paid apps and in-app purchases made in Kenya. This will be effective as from April 8, 2021. Even if you’re not in Kenya, this change in tax laws will still apply for purchases by Kenya customers.

According to the company, they will send the applicable taxes for the app and in-app purchases to the appropriate authority. This means you do not need to calculate and remit VAT for Kenya separately for these customers’ purchases.

Additionally, Google will also begin using VAT-inclusive pricing in Kenya. This means that prices shown on Google Play will include all taxes, regardless of where your business is. This change will apply to all apps you pay for and in-app purchases made by customers in Kenya.

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Simply put…

The cost of mobile apps you pay for and in-app purchases via Google Play will become more expensive. Also, placing a basis on the digital tax bills, this may not be the end of taxes cutting through your wallet.

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