• Kenya’s Media Owners Association (MOA) has spoken out against the proposed Finance Bill 2023, demanding that it be scrapped
• The proposed excise duty is aimed at alcohol advertisements, betting, gaming, lotteries, and prize competitions
• They want the proposed rate reduced from 15% to 5%, with advertisements, sponsorship, affiliate marketing, and subscription services exempted
Kenya’s Media Owners Association (MOA) has spoken out against the proposed Finance Bill 2023, demanding that it be scrapped.
Agnes Kalyeke, MOA chair.
MOA told the National Assembly Finance and Planning Committee on Tuesday that the proposed 15% excise duty on advertisements will have a devastating effect on the economy because it will raise advertising costs for affected businesses.
The proposed excise duty is aimed at alcohol advertisements, betting, gaming, lotteries, and prize competitions.
The media industry also opposes the 15% withholding tax for digital content creators, claiming that it contradicts the government’s agenda by stifling creative sector growth and increasing unemployment through layoffs.
They added that other consequences include denying the general public access to information and news, as well as creating an administrative burden if individuals are required to withhold tax on nominal and frequent subscriptions.
They want the proposed rate reduced from 15% to 5%, with advertisements, sponsorship, affiliate marketing, and subscription services exempted.
On the 5% withholding tax on sales promotions, marketing and advertising services, MOA is of the opinion that it will lead to cash flow challenges for SMEs due to tied-up working capital.
They state that the proposal will discourage SMEs from paying for small adverts (loss of titles, classifieds, cautions, obituaries).
“It costs between Ksh.300 and Ksh.2000 to place an advertisement of an obituary in a newspaper. Having this in mind, the imposition of the proposed tax on such low amounts seems quite exorbitant, and quite unfair to the common mwananchi who is already facing dwindling income levels,” reads part of the submission.
Concerning the contentious Housing Fund levy, the MOA claims that it may result in job losses, and proposes that the contribution be voluntary and exclude employers.
Today, Wednesday, is the ninth day of a public participation exercise for the proposed Bill, with 90 people expected to make submissions.
So far, 151 interest groups have made submissions to the committee, with 1,400 memoranda sent via email.
The budget will then be tabled before Parliament on June 15.
