Airtel Kenya has today announced the revision of the excise duty on telephone and internet services rising from 15% to 20%. The new changes, that took effect on 1st July 2021, are in accordance with the Kenyan government’s amendment to the Finance Bill.
With these changes in mind, Airtel has now increased its headline voice tariff to KES 2 plus taxes leading up to KES 2.78 per minute. However, Airtel has made it clear that it has ensured data and voice bundle prices remain unchanged. This means subscribers will not have to pay more to buy Airtel’s Amazing, Unlimited or Tubonge bundles.
The Finance Bill, 2021 that was signed into law earlier this week was expected to see Kenyan telcos raise their airtime and data prices. Luckily, Airtel’s move shows that it’s just the rates that might have to be revised and not to a significant degree.
We are yet to see what changes the likes of Safaricom and Telkom Kenya will announce although we might expect them to be similar to Airtel’s.
This comes about two months after the Treasury decided to amend the 2021 Finance Bill that had introduced the digital service tax to all Kenyans and foreigners operating in the country.
The tax was definitely not received well especially by young Kenyans who have been setting up purely online businesses, a move that seemed to be rising over the last few years. The Treasury proposed the tax being only applicable to non-residents/ foreigners from January 1, 2022.
This provision will now definitely offer relief to residents. Especially those who are already subject to tax on the income that they derive from the digital platforms.