New Kenyan digital tax to take effect in January 2021

The Kenyan Revenue Authority (KRA) has recently reached out to the public for feedback on the impending digital tax set to be implemented in the country. Originally scheduled to take effect at the start of the 2020/2021 financial year, the tax faced significant opposition from various stakeholders. Members of parliament expressed concerns about the timing of the tax, particularly in light of the economic challenges brought on by the COVID-19 pandemic. Recognizing these concerns, the KRA decided to reevaluate the tax framework to make it more accommodating. In a bid to ensure widespread acceptance and support, the KRA has announced a delay in the implementation of the tax and is actively seeking input from the public. The call for public participation is aimed at gathering ideas and suggestions from citizens on how to improve the digital tax system. By engaging with the public, the KRA hopes to create a tax structure that is not only effective in generating revenue for the government but also perceived as fair and progressive by the public. This shift in approach reflects a willingness to listen to the concerns and recommendations of Kenyan taxpayers, signaling a more collaborative and transparent process in the development of tax policies. The KRA's initiative to solicit public feedback underscores the importance of stakeholder engagement in shaping policies that impact the wider population. While the digital tax is intended to broaden the tax base in Kenya and capture revenue from the growing digital economy, it is crucial that the implementation process takes into account the diverse perspectives and needs of taxpayers. The move to involve the public in decision-making highlights a commitment to democratic governance and inclusive policymaking.