State starts collecting Sh1bn rural access levy from telecom firms

The State has started collecting a levy from telecommunication operators and broadcasters to support the introduction of ICT services in areas considered commercially unviable.

The Universal Service Fund levy became effective in July and is managed by an independent committee comprising representatives from the sector and appointees of the ICT Cabinet secretary.

Operators such a Safaricom, Airtel, Nation Media Group and Posta are required to remit 0.5 per cent of their gross revenue to the fund, which is estimated to raise Sh1 billion from the nearly Sh200 billion in annual revenues from licensed firms.

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“All the operators are expected to start remitting their contribution, which has been back dated to July. We have already invoiced them and some have actually started paying,” said Francis Wangusi, CCK director general, Tuesday when he appeared before the parliamentary committee on Energy and Communication that wanted to know how the fund will be operationalised.

Mr Wangusi said CCK had put in its contribution of Sh1 billion and in subsequent years will be remitting 25 per cent of its collections.

The regulator collects about Sh8 billion in licence fees — meaning it will contribute Sh2 billion to the fund from July 2014.

The government intends to use the money to deploy   high-speed Internet access, erect mobile telephony masts and upgrade data masts in remote areas. 

Mr Wangusi said close to 1,120 sub-locations out of a total 7,149 have no access to basic communication services.