TL;DR Breakdown
- Kenya looking to impose a 1.5% crypto tax
- The country joins the likes of Israel and United States who have implemented a tax regime on crypto transactions
Kenyan authorities have announced that the country is going to be imposing a crypto tax that would become effective early this year. According to the authorities, the regulation is part of the newly revamped Finance Act whose major focus is on the digital service market.
The crypto tax, known as Digital Service Tax, or DST, will now see all e-market transactions attract a payment of 1.5% tax.
Reginald Alango, a Kenyan on the board of crypto exchange Bitzlato, said the taxation is a gross value on every crypto transaction. Adding that the impact of the taxation cannot be immediately ascertained until the end of the first quarter of the year.
Alango also noted that crypto adoption in the region is growing and the youths of the country are those who are actually driving the adoption and acceptance of cryptocurrency.
Kenya’s authorities also clarified that the imposed crypto tax would be levied on residents and nonresidents of the country, and companies also. For nonresidents, the tax would be the final payment, however, for residents, the tax payment would be offset against any income tax.
The authorities have also argued that the new tax regime would help the government earn more revenue from foreign companies while at the same not obstructing the new digital startups in the country.
Crypto tax regulations increasing worldwide
Kenya’s new announcement has placed the country among the list of countries that are looking to impose a crypto tax regime on their citizens.
Israel has already written crypto holders in the country to give proper details about their assets so that they can be taxed appropriately. The authorities also wrote crypto exchanges to help them provide details of their citizens who might be trading on their platforms.
We also reported how the tax authorities in the United States have reiterated its commitment to taxing citizens who might be transacting in cryptocurrencies in the country.
