Kenya has now been termed as a country with one of the highest taxes in the telecommunications sector, with Safaricom CEO, Bob Collymore revealing that Kshs28 in every Kshs100 spent by a customer goes to the government as tax.
Speaking yesterday at the telco’s Annual General Meeting, Collymore said that this tax burden could worsen if all the county governments continue asking for tax for laying of telecommunications infrastructure in their areas.
“We have seen one county like Laikipia, who have attempted to charge fees for someone putting fibre cable on the ground.” Said Collymore, “ICT has the ability to uplift the economy in the counties and the governors that I have been able to talk to have already recognized the ability of ICT.”
“We are urging the governors and the all the leaders in the counties not to take a short term approach because operators will avoid those counties and work with friendly ones,” added Collymore.
Safaricom is in the process of laying down over 2,300 km optic fibre in the country, and a spot check revealed the project to be underway in most parts of Nairobi and its environs.
Last week, Kenya’s ICT secretary Fred Matiang’i while speaking at the Kenya County ICT Summit also cautioned the country governments against imposing tax on telecommunication projects, saying that ICT was one of the key pillars towards achieving economic development.
Taxation in Kenya has become a contentious issue in the recent past, with the government spreading its taxman’s arm into mobile money transactions, something that saw transaction charges shoot up by 10 percent. Mobile phones have also been included in the taxation bracket, leaving many stakeholders in the ICT industry worried.