Kenyan crypto investors may have to pay taxes for selling or using digital currencies in a transaction.
The Kenya Revenue Authority (KRA), a government agency responsible for the assessment, collection, and accounting of all revenues that are due to the government of Kenya, is planning to impose taxes on crypto transactions.
According to the news report shared by Business Daily Africa, KRA aims to pass the Capital Markets (Amendment) Bill, which obliges investors to pay taxes for selling or using digital currencies in a transaction.
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The report highlighted that crypto taxes will be similar to the ones applied to bank transactions. In Kenya, banks take a 20% excise duty “on all commissions and fees charged on transactions.”
Moreover, based on the report, the Capital Markets (Amendment) Bill indicates that investors that held the cryptocurrency for not longer than 12 months will be paying income taxes. On the other hand, investors that held crypto for longer than 12 months will pay capital gains taxes.
Apart from paying taxes, Keyan crypto investors will have to provide certain information to Kenya’s financial regulator, the Capital Markets Authority. In a nutshell, crypto investors will have to share information about “the amount of proceeds from the transaction, any costs related to the transaction, and the amount of any gain or loss on the transaction.”
The author of the bill, Member of Kenyan Parliament Abraham Kirwa, when talking about the Capital Markets (Amendment) Bill, noted:
The amendment will provide for specific provisions to govern digital currency transactions in Kenya, including the definition of digital currencies, its creation through crypto mining and provide for regulations around trading of digital currencies.
It is not surprising that Kenyan authorities aim to regulate the country's crypto industry. In June, the United Nations shared a report revealing that 8.5% of the population (around 4.25 million people) owns cryptocurrencies. It makes Kenya fall into the list of top 5 countries with the biggest crypto ownership in the world.