President Uhuru Kenyatta proposes eight percent tax increment on mobile money transactions

Mobile money transfers. [GetPesa]

Telecommunication companies woke up to the news of an increase in the cost of money transfer services.

This comes after President Uhuru Kenyatta proposed an increment in tax from 12 percent to 20 percent in mobile transfer platforms for Safaricom, Telkom, Airtel, money transfer agencies, banks and other financial institutions.

The fee charged will be more than excisable value owing to the fact that there have been a growing number of consumers using the mobile money transfer in the recent past. The move is aimed at raising further Sh25.7 billion on tax revenue for 2018/19 financial year.

As the President seeks to seal the loopholes of low revenues raised by the country, the ordinary Kenyan will have to foot for the bill that has been alleged to emanate from heightened levels of corruption.

Treasury Cabinet Secretary Henry Rotich slapped Telco’s with a two percent increase of mobile money transfers which saw the companies such as Safaricom raise the transaction cost of deposits and withdrawals.

This latest government move in raising taxes is going to largely affect the poor who depend on the system.

Money transfers in the country have been on the rise over the past two years with Safaricom’s M-Pesa enjoying massive subscriptions to its system.

The increment of taxes will be used to fund universal health projects among other government developments.