Kenya's Treasury Plans to Lower Taxes on Cryptocurrency Assets
Reduced Crypto Tax Rates: Kenya's New Digital Economy Strategy
Kenya is shaking up its digital economy game. The National Treasury has proposed an exciting change: reducing the tax levied on digital asset transactions from the current 3% to a friendlier 1.5%. This move is aimed squarely at cutting costs associated with transferring digital assets, such as cryptocurrencies and non-fungible tokens(NFT).
This new tax rate is outlined in the recently revealed Finance Bill 2025, where it's stated, "In Paragraph 13(In the Third Schedule to the Income Tax Act is amended in Head B, by deleting the words three percent and substituting with the words one point five percent".
This tax-friendly shift can boost the adoption of digital assets within the nation, potentially increasing the number of cryptocurrency users in Kenya.
News Bites:- Kenya Revenue Authority Issues Notice on Renewal of Betting Licenses, April 30, 2025- Betting Control and Licensing Board Suspends Gambling Ads Across All Media Platforms, April 29, 2025- Exclusive: Harnessing Data for Growth: Shivika Singh's Two-Decade Odyssey in Gaming and Data Analytics, March 24, 2025- Kenya Launches 'Crypto' Bill Amid Call for Better Oversight, January 23, 2025
Also read: Kenya Introduces Virtual Assets Bills to Regulate Crypto and the Digital Finance Sector
The Income Tax Act defines digital assets as any value that is not tangible, including cryptocurrencies, token codes or a number held in digital form, and generated through cryptographic means. These digital representations of value can be exchanged.
Digital asset tax was introduced in the Finance Act 2023 and was set at three percent of the gross fair market value of cryptocurrency transactions. The Kenya Revenue Authority estimated the market to be transacting around ksh 2.4 trillion.
Recently, a Virtual Assets Service Providers Bill of 2025 was tabled in the parliament. This bill would compel virtual currency exchanges and wallet providers to disclose the owner of cryptocurrencies, aimed at targeting tax cheats, criminals, and hackers.
Stay tuned to understand more about this evolving digital economy landscape as Kenya dives deeper into the world of cryptocurrencies, NFTs, and the broader digital asset market.
With the reduced tax rates on cryptocurrency transactions, digital finance businesses in Kenya are poised to thrive, potentially attracting more investors and boosting the nation's cryptocurrency user base. This tax-friendly shift aligns with Kenya's broader strategy to harness technology in the finance sector, fostering growth and innovation.
