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LinkedIn Announces Hike in Subscription Fees Due to Digital Tax

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Business networking website LinkedIn has increased subscription rates after the government rolled out the 16 percent value-added tax (VAT) on digital transactions. The Kenya Revenue Authority (KRA) implemented the digital tax in January 2022 and gave foreign companies up to six months to comply.

“We want to provide you with an important tax update related to Kenya tax that will impact your LinkedIn purchase(s). Kenya has introduced tax at 16 percent on e-Services. In order to comply with these laws and regulations, this tax will be added to your current LinkedIn purchase starting on May 11, 2022,” LinkedIn said in a notification to its members.

The American tech firm increased the fees effective May 11 for all its packages.

Read: LinkedIn Rolls Out Service Marketplace for Freelance Jobs Globally

“If you add a valid business PIN ID to your profile, LinkedIn will not charge you tax. However, please note, if a valid Kenya tax number has been provided, this will be accepted by LinkedIn as notification of your responsibility to account for VAT under the reverse charge mechanism.”

LinkedIn’s packages include career, business, sales navigator core, and recruiter lite. The charges range from a minimum of Sh3,200 to Sh10,719 per account.

The company has increased the fees for its career account to Sh3,219 from S2,775 and for its career account to Sh5,149 from Sh4,439. The Sales Navigator account now costs Sh8,759 from Sh7,551 while the recruiter lite account now goes for Sh10,719 from 9,241.

Read also: KRA Targets Real Estate, High Net Worth Individuals In Bid To Hit Ksh2.5 Trillion Yearly Tax Collections

Since the introduction of the digital tax, several tech companies in the country have increased their costs to comply with the taxman. Netflix, Google, cloud infrastructure provider Digital Ocean, communications software Muck Rack and Facebook have all increased their prices.

The KRA estimates that digital transactions by foreign firms in Kenya are worth Sh226.67 billion, underscoring the importance of e-commerce in Kenya’s revenue-raising efforts.

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Written by Vanessa Murrey

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