Up next in 10
Treasury CS John Mbadi, through the Tax Laws (Amendment) Bill, 2024, has proposed a raft of tax proposals, amongst which includes amending Section 3 of the Tax Income Act and expanding the definition of the digital marketplace to include ride-hailing services, food delivery services, freelance services, and professional services, among others.
WATCH:
-New Tax By Treasury: https://youtu.be/nFHQHJH49b8
Show More Show Less View Video Transcript
0:00
all right everyone welcome back we're
0:01
diving deep today and this time it's
0:03
something that could hit pretty close to
0:05
home for a lot of you in Kenya yeah
0:08
definitely impactful we're looking at
0:10
the digital economy specifically some
0:12
new tax proposals it's all laid out in
0:14
this article we found from name of
0:16
publication CS embody unveils new tax
0:20
proposals targeting digital economy kidy
0:23
title right definitely grabs your
0:25
attention and it's not just some
0:27
abstract Economic Policy this stuff
0:29
affects like how we live every day
0:32
exactly we're talking ride sharing
0:34
getting food delivered even how some
0:35
people earn their living online so let's
0:38
break this down and see what's really
0:39
going on well the backdrop here is that
0:40
Kenya's treasury they're looking to
0:42
increase Revenue seems they fell a bit
0:44
short of their targets happens to the
0:46
best of us right but their solution is
0:48
interesting they're eyeing the digital
0:50
economy this booming sector yeah and
0:52
they want to broaden what's considered
0:54
the digital Marketplace for tax purposes
0:56
so it's not just like the App Store
0:58
taking a cut it's deeper than that who
1:00
are they actually targeting with this so
1:02
there's a few key players think Ry
1:04
haling the big names like bolt Uber safe
1:07
bota all those right which are huge GE
1:09
here I read somewhere Kenya has the
1:12
third highest ride hailing adoption rate
1:14
in all of Africa crazy 46% it's no small
1:18
thing but it's not just them it's also
1:20
food delivery services gloo jimia Foods
1:24
Uber Eats all that oh yeah those late
1:26
night cravings adding to the tax man's
1:27
Delight huh guess you could say that and
1:29
then it it's broader freelance platforms
1:32
people offering Professional Services
1:33
online that whole world which is huge e
1:35
now right right like how much money are
1:37
we talking about flowing through this
1:38
digital space well projections for the
1:40
entire African online food delivery
1:42
Market by 2024 are around 13.75 billion
1:46
US waa that's a lot of sosis but what
1:49
about just within Kenya specifically
1:51
here online food delivery by 2029 is
1:54
estimated to be worth 81.7 billion
1:56
Kenyon Shillings so yeah big money see
1:59
now those numbers make it clear why the
2:00
government's interested but what's their
2:02
justification Beyond just we want to cut
2:05
they frame it as fairness basically
2:07
everyone benefiting from economic growth
2:09
should contribute right so these digital
2:12
platforms they need to pay their share
2:15
just like traditional businesses so
2:16
Level Playing Field kind of thing yeah
2:18
but hold on when they say platforms do
2:19
they mean like me ordering a pizza or no
2:22
no their focus is on the platform owners
2:25
the companies themselves not the
2:27
individual users or the people working
2:29
through them okay that's important to
2:30
clarify but still even if it's aimed at
2:33
the big guys there's got to be some
2:34
ripple effect right oh absolutely this
2:36
could impact a lot of Kenyans drivers
2:39
Freelancers consumers everyone's in the
2:41
mix and not always in a good way I
2:44
imagine what are some of the potential
2:46
downsides they're talking about well for
2:48
consumers the most obvious one is higher
2:51
prices companies pass on the tax burden
2:54
your ride or meal suddenly costs more
2:56
yeah no one likes that and for the folks
2:59
actually working in this digital economy
3:01
like Freelancers what happens to them
3:03
things could get complicated they might
3:05
need to register as official businesses
3:06
deal with more tax paperwork all that
3:09
imagine you're happily designing
3:11
websites from your couch suddenly you're
3:14
filing forms like a corporation big
3:16
shift definitely adds a layer of
3:18
bureaucracy for sure and it's not just
3:20
the hassle it's also the cost if those
3:22
fees get too high it can discourage
3:24
people exactly someone might be thinking
3:27
is freelancing even worth it anymore
3:29
more and then the whole system suffers
3:31
that's the fear basically but look it's
3:34
still early days for these proposals
3:36
they got to go through Parliament lots
3:37
of debate to come plus this isn't even
3:39
the only thing on the table right the
3:42
article mentioned a whole bunch of other
3:43
bills CSM bat is proposing yeah like tax
3:46
procedures Public Finance lots of moving
3:48
Parts we're probably just seeing the tip
3:50
of the iceberg here which makes me
3:52
wonder what's the long-term Vision how
3:54
will this reshape Kenya's digital
3:56
landscape years down the line that's the
3:59
million question isn't it will it
4:01
actually Foster Innovation help the
4:03
economy grow or will it just be a burden
4:06
and I guess that's where our listeners
4:07
come in if you're part of this digital
4:09
world how do you feel about these
4:11
changes yeah what does it mean for your
4:13
work your daily life it's a conversation
4:16
worth having because this affects us all
4:18
exactly so stay informed stay engaged
4:22
and keep those questions coming we're
4:23
all figuring this out together
4:25
absolutely we'll be keeping a close eye
4:27
on things as they develop and until next
4:29
time keep on diving deep
#E-Commerce Services
#Legislative Branch
#Public Policy
#Taxi & Ride Hail Services