The development and increased use of digital technologies has facilitated business across national boundaries, allowing consumers to access products and services from other countries. The Digital Services Tax (DST) Regulations took effect on 1 Jan 21, introducing a levy on digital marketplace service providers.

According to the Regulations, digital services include the provision of downloadable content, subscription-based media, search engine services, online courses, online transport services platforms, etc. The DST is calculated at a rate of (1.5%) of the total transaction value of the service chargeable at the time of payment.

The Kenya Revenue Authority says the tax is set to widen Kenya’s tax base and generate additional revenue for the government to address the economic and social challenges of Kenyan citizens.