President Uhuru Kenyatta on Thursday, November 7, signed into law the Finance Bill 2019 at State House.
The law contained a controversial clause would allow the introduction of taxes on income raised from the digital marketplace as a measure of ensuring equity in taxation on top of the equally controversial removal of interest caps.
“Digital marketplace means direct interaction between buyers and sellers of goods and services,” State House clarified in an attempt to specify the online activities now under taxation.
This would mean that most of those who trade their goods through social media platforms like Facebook, Twitter and Instagram would be required to pay tax.
Further, the Finance Act 2019 exempted the National Housing Development Fund from income tax in line with the Big 4 Agenda.
Some of those present during the ceremony were; Speaker of the National Assembly Justin Muturi, Head of Public Service Joseph Kinyua, Acting National Treasury CS Ukur Yatani and Attorney General Paul Kihara.
Others were Majority Leader in the National Assembly Aden Duale, National Treasury CAS Nelson Gaichuhie, Treasury PS Dr Julius Muia, Central Bank Governor Patrick Njoroge and Clerk of the National Assembly Michael Sialai among other senior government officials.
In June 2019, the former National Treasury CS Henry Rotich had hinted that the government would would introduce new tax measures that would capture the value of transactions of the e-commerce sector.
“The digital economy is fast-evolving, thereby posing challenges to taxation,” he had stated.
