The Kenya Revenue Authority (KRA) has contacted Airbnb, the online homestay marketplace, to obtain transaction data spanning from January 1, 2021, to December 31, 2022. The purpose of this request is to identify Kenyan hosts who may have been evading taxes.
Airbnb Ireland UC, the data controller for Airbnb Kenya users, has confirmed KRA’s demand for this information, which is expected to reveal host details and their earnings on the platform.
In a statement, Airbnb disclosed that KRA had issued an exchange of information request to the Irish Tax Authority (Irish Revenue) regarding Kenyan hosts. Airbnb is legally obliged to share this information.
“We have been required by the Kenya Revenue Authority (KRA) to provide a limited amount of data about historical transactions that took place on the Airbnb platform during the period from January 1st 2021 to December 31st 2022. This data will identify hosts and details of their earnings on Airbnb,” Airbnb statement read in part.
Irish Revenue will notify Kenyan users whose data is being shared with KRA. The KRA plans to use this data to conduct tax assessments and potentially issue tax demands to Airbnb hosts who have not met their tax obligations.
Kenya is part of the African Initiative by the OECD Global Forum on Transparency and Exchange of Information for Tax Purposes. The Exchange of Information (EOI) initiative is aimed at combating tax evasion and other illicit financial activities while increasing tax revenues.
In Kenya, hosts of short and long-term rental properties are subject to a rental income tax, currently set at 10 percent of their gross rent earnings, but the rate is expected to drop to 7.5 percent from January next year. By obtaining data from Airbnb, KRA aims to identify additional rental properties in the country that fall under tax regulations according to the Business Daily.
Airbnb is also liable for the payment of digital services tax, set at a rate of 1.5 percent of the gross transactional value, excluding Value Added Tax (VAT).
KRA has not yet confirmed its data request from Airbnb, but this move reflects the ongoing global efforts to ensure that digital platforms and their users comply with tax obligations and contribute to the nation’s revenue collection.