Kenya’s finance ministry has proposed 3% tax on the transfer of digital assets including cryptocurrencies in the coming budget year, according to the proposal unveiled this week.

The Ministry of National Treasury & Economic Planning said on May 4 in the proposal, also known as the Finance Bill 2023, that “digital assets includes anything of value that is not tangible, and cryptocurrencies, token codes and generated through cryptographic means……and a non-fungible token or any other token of similar nature…..”

In December 2022, several financial regulators created a working committee to look into how to regulate cryptocurrencies. It includes the Central Bank of Kenya (CBK), the Capital Markets Authority (CMA), the Insurance Regulatory Authority (IRA), the Retirement Benefits Authority (RBA) and the Sacco Societies Regulatory Authority (Sassra).

Kenya is one of the largest cryptocurrency markets in Africa. About 8.5% of the Kenyan population or 4.25 million people own cryptocurrencies, according to a report compiled last year by the United Nations Conference on Trade and Development (UNCTAD).

The country’s budget will be presented in early June.

-Edited by Shigeru Sato
-Photo: Nairobi, Kenya / Unsplash