Zoom Introduces VAT To All Customers In Kenya

Zoom has announced it will begin charging Value Added Tax (VAT) to all customers that have a ‘Sold To’ address in Kenya effective September 1, 2022.

“We are writing to inform you that on or shortly after 1 September 2022, Zoom Video Communications, Inc will begin charging VAT on all supplies made to all customers in Kenya due to recent changes introduced by the Digital Marketplace Supply (Amendment) Regulations, 2022 and the Finance Act, 2022,” Zoom said in a statement.

The video communications company added: “Under previous rules in Kenya, Zoom was required to charge VAT to non-business customers (B2C) in Kenya; whilst business customers (B2B) were required to self-assess the VAT under the so-called reverse charge mechanism. However, the Digital Marketplace Supply (Amendment) Regulations, 2022 and the Finance Act, 2022, have amended the requirement applicable to non-resident suppliers of Electronically Supplied Services (ESS). This means that Zoom is now required to charge VAT on all supplies made to all customers in Kenya”

The Digital Marketplace Supply (Amendment) Regulations, 2022 and the Finance Act, 2022 removed the administrative task of Kenyan businesses having to notify nonresident suppliers that they are subject to reverse charge VAT. It also abolished the risk of double payment of VAT where a Kenyan business fails to inform the nonresident supplier of its reverse VAT charge obligation.