Businesses have begun implementing 14% V.A.T on all goods and services in Kenya following a directive from the government last week.  

In an effort to combat the effects of the COVID-19 in Kenya, President Kenyatta announced measures to protect Kenyans from the effects of the Corona Virus. Among the measures announced were a reduction V.A.T from 16% to 14 %. Other measures were 100% tax relief for Kenyans earning up to Ksh. 24,000.00, reduction of PAYE from 30% to 25%, reduction of turnover tax for micro, small and medium size businesses from 3% to 1% and reduction of resident income tax to 25%.

Other measures include making available Ksh.10 billion shillings for vulnerable groups such as the orphans and the elderly.

Following this directive, businesses have begun reducing V.A.T to 14%. A spot check by ShopaXo, showed that effective 1^st April 2020, V.A.T had dropped to 14%.

Stop Panic Buying

Meanwhile, while addressing business, Trade Cabinet Secretary Peter Munya asked Kenyans to stop panic buying, as this was the cause of traders increasing the price of basic commodities. This follows a partial lockdown announced by the President from 7.00pm to 5.00pm.

At the same time, the government has engaged local manufactures such as Rivetex to mass-produce facemasks, 10000 cases projected from by the end of the first week in April, coupled with a shortage of facemasks and other essentials to combat COVID-19. The company, according to its managing director Prof Thomas Kurgat, is able to produce 1200 masks per day.

These and other measures come at a time the number of COVID-19 cases in the country rose from 50 to 59 on 31^st March 2020 with more cases being reported in Nairobi and in Kitui.

Barely two weeks into the Corona Virus pandemic businesses and thousands of Kenyans are staring at an economic shutdown.

Zuku, the Wananchi-owned company has reclaimed the top spot in fixed internet connections from Safaricom in the three months since December 2019 to control 35 percent of the market, latest industry data at our disposal.

Communications Authority of Kenya said Zuku had 175,433 fixed home and internet connections as at end of December while Safaricom had 165,810 connections.

This shows that Zuku’s subscribers grew by 23,885 in the review period compared to Safaricom’s 11, 207. Safaricom had emerged top in the quarter to September overtaking Safaricom with the leadership switch reflecting heightened competition between the two for control of the local fixed internet market. Other players in the industry trailing the two.

Zuku is taking its rightful position since Safaricom toppled it from the top position in the second quarter last year, since entering the fixed data market since entering the segment in 2017.

Its market share stood 33 percent in December compare to 34 percent in September of 2019, the report shows.

“During the period under review, fibre-to-the-office/home data/internet subscriptions recorded the highest number of broadband subscriptions,” the regulator said in the report.

10.2 Percent Increase

The report also shows that fixed internet connections crossed the half-a-million mark for the first time to hit 501,455 customers, reflecting a rise of 10.2 percent from the three months ended September propelled by increased investments by Telco’s to link more offices, institutions  and homes to internet.

Zuku and Safaricom grew their connections by 1.7 and 0.2 percent respectfully in the quarter to December 2019.

The two Telco’s have been locked in a price war for market share growth as the two look at tapping into a market occasioned by rising demand for fibre-based internet for people working from homes and households seeing it as a necessity for entertainment.

Jamii Telecommunications, with 78,149 connections during the same period, came in third in the fixed internet connections reflecting a 17 percent increase from the three-month ending September 2019.