Kenya High Court Rules Platforms Liable for VAT: Major Impact on Gig Economy and Digital Services

• Kenya’s High Court ruled that digital platforms like Sendy are principal suppliers, not just marketplaces, making them liable for VAT on the full customer payment.
• Platforms are now designated as VAT withholding agents, shifting tax compliance and reporting obligations directly to them.
• The decision is expected to reshape digital platform business models, affect pricing and contracts, and may support future gig worker re-classification.
• The ruling overturned a previous tribunal decision, allowing the Kenya Revenue Authority to recover significant unpaid VAT from Sendy.
• The degree of control exercised by platforms was key in determining VAT liability, setting a precedent for the broader gig and digital economy in Kenya.

Source: vatabout.com

Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.

---

---