Kenyans To Start Paying More For importing Phones In A New Duty

Kenyans to start importing mobile phones at a higher price starting July 1^st, 2022 after a new duty was imposed on the gadgets. The duty, which is included in the Finance Act 2022, was assented to into law by President Uhuru Kenyatta on Tuesday, June 21^st, 2022.

The bill imposed a 10 percent duty on the importation of mobile phones and the calculation will be based on the cost of mobile phones ordered into the country and other levies.

The two new duties on the purchase and use of mobile phones were not part of the original Finance Bill 2022 submitted by Treasury Secretary Ukur Yatani but were introduced during the debate by the House last month.

“Excise duty on the importation of cellular phones shall be at 10 percent of the excisable value,” reads the Act which President Uhuru Kenyatta signed into law last week.

Currently, the use of telephone and internet data services already attracts a 20 percent duty which includes a 16 percent VAT. Money transfer services like M-Pesa also attract a 12 percent duty charge.

According to tax experts, the new taxes on the purchase and use of mobile phones were aimed at raising new revenue rather than protecting a non-existent local industry.

“The Treasury and MPs have realized that mobile phones are a lifeline for everybody and there are more and more of us that are buying phones, and more and more will want to buy them in future,” Nikhil Hira, a partner at tax advisory firm Kody Africa LLP, said on telephone.

“I see it as a revenue-generating measure because of the number of people that want a mobile phone. It doesn’t make a lot of sense because we don’t have a local industry. I would understand if we had a mobile manufacturing industry because we would be trying to protect it.”

He argued that the end consumer will be the most affected as the local dealers will be forced to hike the prices to recoup their expenses.

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