Kenya: Finance Act 2020 including Digital Service Tax was repealed and replaced with significant economic presence tax

On 27 December 2024, the Finance Act 2020 including the Digital Service Tax (DST) was repealed and replaced by the Tax Laws (Amendment) Act. The Act replaced the existing 1.5% Digital Service Tax with a Significant Economic Presence (SEP) tax applicable to non-residents earning from digital marketplaces at 3%. Additionally, the Act established a 15% Minimum Top-Up Tax (MTT) aligned with OECD’s Global Anti-Base Erosion Rules. The MTT applies to multinational groups with annual turnovers above KES 104 billion.