Kenya: Taxes account for 45 percent of the cost of payTV decoders

Regulation & Policy

Kenyan pay-TV providers MultiChoice, Smart TV and Wananchi Group's Zuku have blamed the low penetration of their services on decoder import duty, Business Daily reported. Taxes account for 45 percent of the cost of the gadget.

According to Business Daily, the operators say a 16 percent tax would enable them to reduce prices, a view the government said it was evaluating. DStv parent MultiChoice's Kenya General Manager Stephen Isaboke said import taxes on ¬decoders are a major discouraging element in the uptake of pay television services in the country. Information and Communications Permanent Secretary Bitange Ndemo said that the high taxes on decoders could stifle migration to digital broadcasting. On average, a pay-TV decoder costs KES 6,000.

Service providers said the price could fall to KES 3,260 if import duty is waived. The uptake rate of pay-TV currently stands at 1 percent with DStv dominating the market for the last 15 years. The service provider has 100,000 clients compared with 35,000 for its nearest competitor, Zuku.