Kenya wants to tax smartphones again

On Techpoint Digest, we discuss Kenya taxing smartphones again, how South Africa's Starlink standoff is turning into a political disaster, and the fake Amazon email problem in South Africa.

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Kenya wants to tax smartphones again

SA Starlink standoff is turning into a political mess

That Amazon email in your inbox might not be real

Kenya wants to tax smartphones again

Smartphones

Kenya’s Finance Bill 2026 is proposing a major new tax on smartphones, and for a country that has spent years pushing digital inclusion, the move is already raising alarm bells. The bill, tabled on May 13, 2026, introduces a 25% excise duty on mobile phones, a charge that would sit on top of the existing 16% VAT, import declaration fees, railway development levies, and other import-related taxes already attached to devices entering the country. 

Treasury Cabinet Secretary John Mbadi says the Finance Bill is aimed at boosting government revenue, with new taxes also targeting crypto wallets, digital services, and card networks. But the proposed smartphone tax is landing especially hard because phones in Kenya are no longer viewed as luxury products; they are basic infrastructure for everyday life.

Retailers and industry players say the impact on consumers could be immediate. Smartphone prices in Kenya have already surged in recent years, with the average selling price jumping from KSh 5,955 in 2019 to nearly KSh 19,000 by mid-2025 due to currency depreciation, import costs, and tighter controls on grey-market devices. Adding another 25% excise duty on top of that could push entry-level smartphones completely out of reach for many low-income households. 

That creates a deeper problem for the government itself. Analysts warn the tax could end up driving consumers away from formal retailers and into the grey market, undermining the exact tax revenues the Finance Bill is trying to increase. Kenya has spent years trying to reduce informal phone imports and strengthen official distribution networks, but steep price increases could reverse that progress quickly. It is the classic tax trap: raise costs in the formal market, push people i...