‘I’m moving to the moon’: New Internet tax shocks Kabogo

Kenyans continue to fill the pinch of the new taxes introduced via the Finance Act 2018 as various players move to implement them.

After banks and mobile service companies begun implementing the measures, Internet Services Providers ( ISPs) have now begun sending notices to customers announcing that telephone and internet data services will henceforth be charged excise duty at a rate of 15% of the excisable value.

May have taken to social media to express their shock. While many Kenyans focussed on the VAT on fuel products, amendments made to the Finance Bill 2018 when President Uhuru Kenyatta returned it to Parliament with a proposal to reduce it from 16% to 8% to assuage public anger, were largely ignored.

Excise duty on bank transactions went up by 8% to stand at 20% while mobile transaction excise duty was doubled from 10% to 20%. The government also imposed an anti-adulteration levy of Ksh 18 per litre on kerosene.

Among those who have expressed shock is former Kiambu Governor William Kabogo after Zuku informed him he has to pay Ksh 1,237 and Ksh 1,388 after spending Ksh 11,299 on internet data last month. He vowed to resist and later threatened he ” was moving to the moon.”

Zuku; NO WAY! I resist. Dear Client. Following publication of Finance Act 2018, 15% Excise Duty has been introduced on internet data. Please note we have effected the same. Your AC 275857 package price is Kshs.11299 inclusive of E Duty Kshs.1237 & VAT shs.1388; due date 12-Oct-18

— Hon. William Kabogo (@honkabogo) October 2, 2018

Here are other reactions:

@ZukuOfficial why should continue using Zuku when Safcom has come to my estate & price is same but better services?..Finance Act 2018 ..15% Excise Duty ..introduced on internet data..Due date is adjusted to 26-Oct Price Kshs.2499 inclusive of Excise Duty Kshs.286 & VAT Kshs.305

— patrick Achola (@patrickmarc1) October 2, 2018

Never mind that in law, VAT earned in one month is filed by the 20th day of the next month. Of course not under the Zuku VAT Act, Cap 000 of the Laws of Kenya.@ZukuOfficial

— #Changing Africa (@AfriqueMelanin) June 25, 2018

Zuku what the hell?? Dear Client. Following publication of Finance Act 2018 on 21-Sep-18; 15% Excise Duty has been introduced on internet data. Please note we have effected the same. Your AC 213740 package price is Kshs.2499 inclusive of Excise Duty Kshs.286 & VAT Kshs.305;

— Cheruiyot (@Cheruiyot_EK) October 2, 2018

@ZukuOfficial Dear Client. Following publication of Finance Act 2018 on 21-Sep-18; 15% Excise Duty has been introduced on internet data. Please note we have effected the same. Your AC 296964 package price is Kshs.3999 inclusive of Excise Duty Kshs.458 & VAT Kshs.488;bye zuku

— Francis Akatu (@knox_akatu) October 2, 2018

Though Safaricom, the leading telecommunications company, is yet to announce price changes, it has already revised its mobile phone data offering, eliminating some low-cost ones.

The Law Society of Kenya (LSK) has since moved to court averring the new internet tax violates fundamental rights and freedoms.

“The internet is an enabler of all the rights guaranteed under the Bill of Rights. Universal access to it must be guaranteed and aggressively pursued. More than 250 government services are now offered exclusively over the internet. Communication from the State is also done online. Despite it being a necessity, a large population of Kenyans do not have access to the internet as they cannot afford it. A government policy to increase the cost of such a basic necessity therefore discriminates against those without access to the internet on the basis of financial status and social origin,” the lawyers body said.

READ: TWO NAIROBI BEAUTY SPAS FINGERED FOR “ILLEGAL ACTIVITIES.”

LSK added the president acted outside his mandate under Article 115(1)(b) by introducing new issues through his memorandum without subjecting the same to public participation.

“By making recommendations on issues not canvassed in the earlier bill, the president circumvented the normal legislative process,” the petition filed last Friday reads in part.