The Finance Bill 2023 in Kenya, recently passed and signed into law, has implications for digital content creators, crypto traders, and digital lenders. Content creators will now be required to pay taxes on their earnings from digital content monetization. The law defines digital content monetization as offering various forms of content electronically for payment, including through advertisements, sponsorships, subscriptions, merchandise sales, and more. The bill imposes a 1.5% withholding tax on income earned from digital content monetization.

Crypto traders are also affected by the bill, as it introduces a digital asset tax (DAT) on earnings obtained from the transfer or trade of digital assets such as cryptocurrencies and NFTs. Platform owners will deduct 3% of the value of the digital asset being transferred or exchanged as DAT. Non-resident platform owners are required to remit the tax within 24 hours after deduction. The law may discourage crypto trading due to the short time period for deductions and the taxation of turnover rather than gains.

Furthermore, the bill expands the definition of 'fees' to include charges associated with lending activities conducted by digital lenders. This means that all costs linked to digital lending transactions will be subject to excisable duty, potentially leading to increased borrowing costs from digital lending apps.

These changes will take effect from July 1, 2023.

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