Fresh data by Kenya Revenue Authority indicates that Airtime tax collections hit Sh19.7 billion within 9 months.
With the Government targeting to collect Sh20.2 billion in the 2018/19 financial year from this segment, the treasury now hopes to exceed that target with only Sh1.3 billion left to collect over the next three months.
The move to increase tax on airtime from 10 percent to 15 percent as is in the Finance Act, 2018 meant that customers will spend more on calls, texts and data with the telco players passing the cost down to consumers.
In October 2018, Safaricom increased the price on voice calls, data and SMS.
Safaricom raised the cost of calls by 30 cents, and SMS by 10 cents, after the tax rose to 15 percent, in addition to the prevailing 16 percent Value Added Tax (VAT) on mobile service.
“Additionally, we have also reviewed our prices for mobile data bundles, fibre to the building and fibre to the home to effect the new 15 percent excise duty tax on internet,” Safaricom said in a statement at the time.
Mr Rotich told the National Assembly’s Finance and National Planning committee last year that the airtime and internet bundle taxes were specifically intended to raise Sh20.2 billion of this year’s Sh2.97 trillion Budget.