Creative economy gets Ksh16.3 billion boost
The Digital Superhighway and Creative Economy was allocated Sh16.3 billion to fund initiatives under the ICT space in the 2024/25 budget.
This encompasses Sh1.1 billion for Government Shared Services; Sh704 million for Digital Superhighway; Sh 2.3 billion for the construction of Kenya Advanced Institute of Science and Technology at Konza Technopolis; Sh2.8 billion for Kenya Digital Economy Acceleration Project and Sh2.8 billion for maintenance and rehabilitation for maintenance and rehabilitation of Last Mile County Connectivity Network.
To raise the amount, the government is proposing a raft of cuts and taxes in equal measure on key infrastructural support platforms so that the desirable growth is achieved.
Stakeholders are however say some proposals therein are too punitive, particularly for the entertainment and creative sector whose core work tools are affected.
Amongst the sectors directly impacted by this calendar year’s budget was the Creative Economy space and industry players are not a happy lot. The Contentious Finance Bill 2024 has received flak from the sector that currently employs thousands of youth with many looking at their earnings expected to be slashed off their sweat especially the digital content creators.
At least 8000 creators had earlier last week presented their petition to the National Assembly Committee of Finance & National Planning headed by the MP for Molo Kuria Kimani and submitted their memorandum. Members affiliated to film, music, visual art, performing arts, literature, sports and content creation had a hand in the joint document whereupon they called on the Government to be considerate on the plight of their craft in an already desperate industry. even as players in the sector called the industry sensitive. The Artists therefore urged Legislators to reject a raft of proposals in the Bill that will directly impact their livelihoods.
Less remuneration
The Bill for starters has proposed Excisable and increased excise duty on airtime and data with a planned amendment of the First Schedule of CAP 472-Part II. This will naturally and directly impact the growth of the digital economy where hundreds of creatives derive their source of income.
According to recommendations in the Bill, the popular platform SKIZA will see artists especially musicians onwards receive less remuneration because the Application trades explicitly on airtime thus taxes will be applicable henceforth. According to the Creative players, that proposal must be rejected and as such proposed that VAT and Tax on Airtime and Data be waived since it was not a value added product.
Creatives also in their memo to Government, want the replacement of 1.5 per cent Digital Service Tax with SEP (Simplified Employee Pension) Tax at 20 per cent of Gross Turnover (as scheduled proposal under Clause 8) because the proposal will complicate the business and thus paint in bad light the image of the domestic market globally. Artists say global platforms working in the country would reduce their investment in Kenyan content and this would cause collateral damage in terms of employment in the industry. In the memorandum, they want a flat tax rate of six per cent charged on profits and the VAT charged currently on payments to the platforms cut out.
