Corporate News

Budget: Kenya waives import duty on Digital TV gadgets

Communications Commission of Kenya offices in Nairobi. The country’s industry regulator had identified high cost of set-top boxes and low awareness among consumers as key barriers to their uptake by consumers. Photo/File

Communications Commission of Kenya offices in Nairobi. The country’s industry regulator had identified high cost of set-top boxes and low awareness among consumers as key barriers to their uptake by consumers. Photo/File 

In Summary

Finance Minister Njeru Githae on Thursday read Kenya’s record Sh1.45 trillion budget.

Budget 2012/13 highlights:

Digital TV migration: Waive import duty on gadgets that will set us on this path.

For Kenyans to access affordable health care, food supplements zero rated

The supplements currently attract a 10pc tax.

To promote bee-keeping, inputs zero-rated

Real estate: KRA to embark on residential areas mapping so that all landlords are roped in for tax collection on rental income

To support private sector especially steel and iron, increase import duty on galvanised wire from zero to 10 per cent.

Mr Githae said alcoholism had affected the youth and allocated Sh1 billion to National Agency for the Campaign Against Drug Abuse (Nacada) for enforcement of Alcoholic Drinks Control Act commonly known as Mututho Laws.

Kenya has waived the 25 per cent import duty on Set-top boxes, the gadgets that convert analogue frequencies to digital, to kick new life into the roll out of digital television broadcasting.

Finance Minister revealed the measure on Thursday when he presented the country’s 2012/13 national budget in parliament.

The Broadcasting industry had been pushing for the zero-rating of the gadgets that are central in the uptake of digital TV.

Majority of consumers in Kenya currently possess analogue TV sets which would automatically become obsolete once the country switches off analogue TV broadcasting.

The world through an agreement of United Nations’ International Telecommunication Union (ITU) had set June 2015 as the cut-off date for analogue broadcasting. Kenya is currently on pilot migration and aims to fully switch over by 2013 ahead of the global 2015 deadline.

Earlier Kenya had set 2012 as own deadline but unforeseen challenges saw the date moved forward.

The country’s industry regulator, Communication Commission of Kenya (CCK) had identified high cost of set-top boxes and low awareness among consumers as key barriers to their uptake by consumers.

The budget announcement also comes days after CCK said it is set to license 168 operators in the Pay TV sector which is currently dominated by DStv.

The regulator said the new providers would be licensed under the digital broadcasting regime, which is replacing the analogue platform.

The high cost of operation has partly contributed to the dominance of DStv and the collapse of new entrants like GTV and Smart TV.

A CCK competition study released three months ago blamed exclusive content rights for stifling competition in the pay-TV market segment.

DStv has largely been riding on the exclusive rights it holds on key content such as sports, including the English Premiership League, to win a following of about three million subscribers in several African markets.