These regulations were gazetted in November 2020 and shall come into force on 2nd January 2021.

Digital Services

Digital services for which digital service tax shall apply include—

  • Downloadable digital content including downloadable mobile applications, e-books and films;
  • Over-the-top services including streaming television shows, films, music, podcasts and any form of digital content; 
  • Sale of, licensing of, or any other form of monetising data collected about Kenyan users which has been generated from the users’ activities on a digital marketplace;
  • Provision of a digital marketplace;
  • Subscription-based media including news, magazines and journals; 
  • Electronic data management including website hosting, online data warehousing, file-sharing and cloud storage services; 
  • Electronic booking or electronic ticketing services including the online sale of tickets;
  • Provision of search engine and automated held desk services including supply of customised search engine services;
    • Online distance training through pre-recorded media or elearning including online courses and training; and
    • Any other service provided through a digital marketplace.   

Location of user

A person shall be subject to digital service tax if that person provides or facilitates the provision of a digital service to a user who is located in Kenya. A user of a digital service shall be deemed to be located in Kenya if,

  • The user receives the digital service from a terminal located in Kenya, where terminal includes a computer, tablet and mobile phone;
  • The payment for the digital service is made using a debit or credit facility provided by a financial institution or company located in Kenya; 
  • The digital service is acquired through an internet protocol address registered in Kenya or an international mobile phone country code assigned to Kenya; or 
  • The user has a business, residential or billing address in Kenya.

Application of digital service tax

Digital service tax shall apply to the income of a resident or non-resident person derived from or accrued in Kenya from the provision of services through a digital marketplace.  It shall be imposed on the gross transaction value of the digital service at a rate of 1.5%.

Digital service tax paid by a resident or non-resident person with a permanent establishment in Kenya shall be offset against the tax payable by that person for that year of income.

Digital service tax paid by a non-resident person without a permanent establishment in Kenya shall be a final tax.


A non-resident person without a permanent establishment in Kenya who provides a digital service to a user in Kenya may register under the simplified tax registration framework.

A resident person, or a non-resident person with a permanent establishment in Kenya, who provides a digital service in Kenya shall be required to apply to the Commissioner for digital service tax registration in the prescribed form.

A person liable to pay digital service tax shall submit a return in the prescribed form and remit the tax due by the twentieth day of the month following the end of the month that the digital service was offered.

For more information contact;

Beatrice Kamau

Outsourced Services Manager

t +254 715 248882 |  +254 733 533449 

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