Communication Authority Addresses Concerns Over Mobile Phone Taxation in Kenya

The Communications Authority (CA) of Kenya has provided clarity on the new tax compliance system for mobile phones. CA Director General David Mugonyi acknowledged that Kenyans had expressed concerns about data privacy, and he addressed these concerns during a meeting with members of parliament.

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Mugonyi explained that the system is focused solely on device integrity and tax compliance, and not on individual transaction monitoring. He clarified that KRA Kenya Revenue Authority) will not have access to people’s data through this system. The system is designed to ensure the right products are in the country and that applicable taxes are paid.

When a new device is activated on a Kenyan network without the necessary taxes being paid, the user will receive a notification. The device’s IMEI (International Mobile Equipment Identity) will then be placed on a blacklist, preventing it from connecting to any local network until the taxes are settled.

Mugonyi assured the committee that previously registered devices will be considered tax compliant and will not face disruptions. The new regulations only apply to devices imported or assembled in Kenya from November 1, 2024, onwards.

The CA also addressed concerns raised by MPs about the impact on expatriates and visitors. Mugonyi stated that tourists and diplomats will have a grace period where their devices will be placed on a temporary “greylist” to allow usage without immediate tax obligations. This greylisting period will be formalized through public participation to ensure transparency and understanding.

Additionally, the CA acknowledged the potential for international tax overlap and suggested the need for data-sharing agreements with friendly countries to avoid double taxation on imported devices.

If you already have a mobile device registered on a Kenyan network before October 31, 2024, you do not need to worry. Your previously registered device will be considered tax compliant and you will not face any disruptions.

If you plan to import or purchase a new mobile device (either imported or locally assembled) after October 31, 2024, you will need to ensure that the applicable taxes have been paid before activating the device on a Kenyan network.

The CA also addressed concerns raised by MPs about the impact on expatriates and visitors. Mugonyi stated that tourists and diplomats will have a grace period where their devices will be placed on a temporary “greylist” to allow usage without immediate tax obligations. This greylisting period will be formalized through public participation to ensure transparency and understanding.

Additionally, the CA acknowledged the potential for international tax overlap andsuggested the need for data-sharing agreements with friendly countries to avoid double taxation on imported devices.

Here’s what it means for you:

1. If you already have a mobile device registered on a Kenyan network before October 31, 2024, you do not need to worry. Your previously registered device will be considered tax compliant and you will not face any disruptions.
2. If you plan to import or purchase a new mobile device (either imported or locally assembled) after October 31, 2024, you will need to ensure that the applicable taxes have been paid before activating the device on a Kenyan network.
3. When you activate a new device, the system will send you a notification if the taxes have not been paid. Until you settle the taxes, the device’s IMEI number will be placed on a blacklist, preventing it from connecting to any local network in Kenya.
4. If you are an expatriate or a visitor to Kenya, you will be given a grace period where your device will be placed on a temporary “greylist”. This will allow you to use your device without immediate tax obligations. The details of this greylist period will be formalized through public participation.

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