Airtel removed Mobile Money Transfer Fees but have to Content with new 10% Excise Duty tax

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It seems Airtel has woken up to try to compete on the mobile money space. This week Airtel Announced that it will allow subscribers to send money to other users at no cost. Yu has been  doing this for sometime but now they have to content with Aritel’s latest move.

It is now possible for Airtel subscribers to send up to Ksh.70,000 free within Airtel network and up to Ksh.35,000 free on any other network . It will be interesting to see if the latest move by Airtel will sway Kenyans to subscribe to Airtel Money. But before we go far with this, it should be noted that this announcement was made before the finance Minister Njeru Githae tabled a proposal aiming to introduce 10% tax on the mobile money transfer. I will not be surprised if Airtel is forced to reverse this to accommodate the new excise duty tax.

Meanwhile  Finance Minister  was quoted by local dailies as saying that the duty will be paid by the service providers and will not affect the customers in any way.

This sector is the fastest growing and so the taxman should also get his bite. I expect this measure to give me close to Sh4.5 billion immediately but I do not expect any increase in airtime or the charges to the customer. This tax is payable by the service providers; not the customer.

Unbelievable how this guy think. Of course no company will absorb such cost and in one way or another the customers will pay for the tax increase.

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