Kenyans to pay more for zoom calls.
Starting next month, Kenyans will pay more to attend meetings and web sites via Zoom after the video communications platform increased its service fee, following the government’s imposition of a 16% value added tax (VAT) on electronic services.
Zoom currently has the lowest price for its video search licenses at Shs 15,000 ($ 150) and the most expensive licenses are sold at Shs 25,000 ($ 240) per year.
This means that the additional VAT, which is a consumer duty borne by the end user, will see Kenyan individuals and businesses pay at least 2,500 shillings more for a cheaper package and at least 4,100 shillings. more for a more expensive package.
However, Kenyans registered for VAT will be exempt from paying taxes. Individuals and businesses that provide or plan to provide taxable goods and services worth at least 5 million shillings per annum have been ordered by the Kenya Revenue Authority (KRA) to register for VAT.
“Zoom has registered VAT in Kenya as a non-resident consumer of electronic services. Therefore, Zoom is responsible for collecting and removing VAT on equipment provided to customers who are not registered for VAT in Kenya, ”the company said in a statement.
VAT tariffs for digital equipment were introduced by the 2019 finance law, but the Treasury also drafted a value-added tax law 2020 (digital market distribution) last year to guide electronic utility tariffs.
The regulations were published in the Official Gazette in October last year, but the companies were given a six-month transitional clause to comply with the law.
“Equipment that can be charged through the expanded digital market for the distribution of tariffs through the downloadable digital market, as well as downloadable software for mobile phones, e-books and movies … contained in digital to listen, watch or play any sound , visual or digital “, the code is partially read.
Price changes are expected to be a double scam for consumers who will have to pay more to meet or attend online meetings, and come several months after the imposition of a Digital Services (DST) levy which is charged at 1.5% of the total guarantee. of operation.
This means that for entities like Zoom, whose operations fall under DST and VAT, additional tariffs will be levied on consumers at higher service prices.
DST payments came into effect on January 1, but the 2021 fiscal law exempted residents from paying taxes, meaning that only foreign organizations with no permanent establishment in the country would continue. Pay more taxes than January 1 of next year.