Business Daily Africa reported on April 25 that Kenya has announced that it will impose a 1.5% tax on all commissions foreign cryptocurrency companies earn from their customers.
The new regulation includes all foreign crypto exchanges that profit from facilitating the sale and purchase of digital assets in Kenya. Business Daily Africa article I got it.
Commissions from over 4 million users
The new regulation expands on the existing 1.5% digital tax service that the country implemented on January 1, 2021. This tax was reserved for foreign companies not registered in Kenya but providing digital services to Kenyans.
The VAT Regulation addresses the new expansion by stating:
“For the purposes of these rules [digital tax service], taxable electronic, internet or digital market supplies include facilitating online payments, exchanges or transfers of digital assets … excluding services exempt under law. “
Regulation defines digital assets as anything that provides value and is created and stored digitally. This definition includes cryptocurrencies, NFTs, and other forms of digital assets such as “data, images, videos, and written content.”
This digital asset definition and new expansion of digital tax services covers the fees generated by foreign cryptocurrency companies in the region from over 4 million users. Major cryptocurrency exchanges such as Binance, Coinbase and Kraken will also fall under the new regulations.
Kenyan cipher
By the end of 2022, 10.71% of Kenyans will own cryptocurrencies, according to data from triple A. This percentage equates to over 6.1 million people, making Kenya one of the largest crypto markets on the African continent.Globally, Kenya Ranks as 19th Country with Most Significant Crypto Adoption in Chainalysis’ 2022 Crypto Adoption report.
In addition to paying close attention to crypto as an investment tool, Kenya is also active in crypto mining. In early 2022, the country declared that it would welcome Bitcoin (BTC) mining companies to set up shop in Kenya and use surplus geothermal power for mining.
In addition to global companies, local citizens are also investing in mining operations. In December 2022, a mining operation quickly spread in a rural village, highlighting how the off-grid energy generated by the mining was used to power the village.
A post about Kenya introducing a 1.5% tax on cryptocurrency companies first appeared on CryptoSlate.
