Safaricom, Kenya’s leading telecommunications company, announced an update in its pricing for services. This is due to the enactment of the Finance Act 2023 and the subsequent lifting of the suspension on the law.
The company stated that it would be reviewing its pricing for call, SMS, data, fibre, and M-Pesa services to accommodate the changes brought about by the new legislation.
Safaricom M-pesa User Interface| Source: Citizen Digital
The Finance Act 2023 resulted in an increase in the excise duty rate. The fees charged for mobile money transfer services, raised from 12% to 15%. However, it also brought a decrease in the excise duty rate for telecommunication services (call, SMS, data, and fibre) from 20% to 15%.
In response to these alterations, Safaricom promptly adjusted its pricing structure. The details of these changes were made available on the company’s website, mobile app, and various USSD codes. These codes include *100#, *200#, and *544#.
The implementation of the Finance Act 2023 faced controversy, leading to the suspension of its enforcement through conservatory orders. However, on July 28, 2023, the Court of Appeal lifted these orders. This was after hearing an appeal from the government represented by Treasury Cabinet Secretary Njuguna Ndungu.
Busia Senator Okiya Omtatah moved to court to challenge the implementation of the Finance Act on June 2nd|Photo/Courtesy
The appellate court determined that the government had met the necessary criteria for granting the orders. It highlighted the significance of public interest in setting aside the conservatory orders issued by the trial judge.
The Court of Appeal also clarified that the appeal challenging the Finance Act 2023 would be heard and decided within 60 days. Thus ensuring a swift resolution to the matter.
Previously, the High Court had suspended the implementation of the Finance Act 2023 on June 30, 2023. At the time, a petition filed by Senator Okiya Omtatah and six other activists was pending determination.
The suspension of the Finance Act 2023 had raised concerns about its impact on government operations. Therefore prompting Treasury Cabinet Secretary, Prof Njuguna Ndung’u, to seek redress through the Court of Appeal.
With the Finance Act 2023 now in effect, Safaricom’s price adjustments reflect the changes in excise duty rates. The rates comply with the updated regulations governing telecommunication and mobile money transfer services in Kenya.
