Kenyans will from next month pay more to use Skype after Microsoft increased its service charges, following the government’s imposition of a 16 per cent Value Added Tax (VAT) on electronic services.
This means that from February 1st, Kenyan individuals and companies will pay at least Sh393.15 (USD 3.47) to subscribe on the platform from the current Sh338.71 (USD 2.99) which is not charged the 16 per cent.
“Due to recent changes to Kenyan tax requirements, from 1st February 2022, Skype is required to include a 16 per cent Value Added Tax on purchases of Skype paid products for Kenyan customers,” it said to its users.
Kenya Revenue Authority (KRA) introduced the Finance Act 2020 Digital Service Taxes (DST) on income from services provided through the digital marketplace in Kenya and is applied at 1.5 per cent on the gross transaction value.
Payment of DST came into force on January 1, 2021 but the Finance Act, 2021 has spared residents from paying the tax, which means only foreign entities that do not have a permanent establishment in the country will continue paying the tax beyond January 1, 2022.
The price changes are set to be a double blow for consumers who are set to pay more to convene or attend online meetings, and come months after the imposition of the Digital Services Tax (DST) which is charged at 1.5 per cent of the gross value of a transaction.
Other platforms that have complied include Zoom Video Communications Inc, Facebook and Google.
