The Kenyan Ministry of Finance has submitted the proposed Kenya Finance Bill 23/24, which could become the country’s official budget if it passes through the bicameral parliament. The proposed law, also known as the Finance Bill 2023, contains some significant changes that would affect the creative sector in Kenya.
One of the main changes proposed in the bill is an increase in the income tax rate to 35 percent for those earning a monthly income of 500,000 KES and above. Additionally, the bill proposes the introduction of a 3 percent tax on digital assets like crypto and token codes (NFT’s)and the imposition of a 15 percent levy on the monetization of digital content.
This particular proposal to increase the tax on digital content from 5 percent to 15 percent is not going down well with creatives in Kenya, including popular singer Nviiri the storyteller. In a social media post, the Sol Generation signee voiced his opposition to the proposal, stating that the government should enable creatives to earn by ensuring their rights are protected on all platforms instead of taxing new ideas and mediums. He also called for the government to engage creatives in finding solutions before making such decisions.
Nviiri is not alone in his opposition to the proposed bill. Many other content creators, including Bruce Oketch, have also expressed their dismay, warning that the proposed increase could kill their careers at a time when unemployment is soaring, and people are looking for alternative income sources. The Bloggers Association of Kenya has also released a statement warning that the proposed increase would destroy the nascent sector.
Furthermore, this proposal not only increases the tax on digital content but also expands the definition of what digital content is. In practice, this proposed law could apply to any form of digital content, including but not limited to videos, audios, and literature. It could also have repercussions beyond the creative and entertainment world, as social and educational platforms could also be subject to the tax, as long as the material is shared electronically and earns revenue.