Kenya Revenue Authority Launches New Crypto Tax Initiative

Nickson Omondi, head of the digital economy tax division at the Kenya Revenue Authority (KRA), announced plans for a real-time tax collection system integrated with cryptocurrency exchanges.

This initiative aims to expand Kenya’s tax base, leveraging the cryptocurrency sector, which recorded approximately $18.6 billion in transactions in 2022.

Starting September 2023, a 3% tax on crypto earnings has been implemented under the Finance Act of 2023, applying to all digital assets, including NFTs. While some exchanges are complying, specifics on tax remittance are still being negotiated.

The KRA is working to establish procedures for filing and remitting these taxes, with penalties for non-compliance, including a 5% penalty and 1% monthly interest on unpaid taxes.

READ MORE:

U.K. Stands Firm on Strict Crypto Regulations Amid Innovation Concerns

Omondi stated that enforcement measures could restrict access to the Kenyan market for non-compliant exchanges and that the KRA may collaborate with international partners to enhance tax compliance.

The upcoming Finance Bill does not introduce new provisions for digital asset taxes but proposes waiving penalties on outstanding taxes.

Alexander Stefanov