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M-Pesa, Airtel Money fees spared from 16pc VAT
Payment service providers led the objection to the proposal to levy VAT on the platforms highlighting its impact on the affordability of services by consumers.
Money transfer charges levied by payment service providers (PSPs) such as M-Pesa and Airtel Money will be spared from the 16 percent value added tax (VAT) as MPs propose additional amendments to the Finance Bill, 2026 to exempt the cash transfer services.
The Departmental Committee on Finance and National Planning has recommended further tweaks to the first Schedule of the Value Added Tax (VAT) Act providing a clear distinction between mobile transfers and support services such as cash handling and payment processing.
