Nairobi, May 13 -- The Treasury is seeking to impose a 16 percent value-added tax (VAT) on Kenya's 42 payment platforms, such as Pesapal, Kenswitch, Airtel Money and M-Pesa, which could trigger an increase in user fees for money transfer services.

A Treasury official said that fees earned by the owners of platforms would attract VAT, arguing that the tax will not apply to consumers' mobile money transfer services and other money transfer services.

"The person who supplies ICT to enable payments, including paybills or tills, is the one subject to VAT," Albert Mwenda, the director-general of budget at the Treasury, told the Business Daily.

"Persons making payments would be out of the scope for VAT as they are not supplying any services."...