KRA Launches New Tax Evasion Crackdown on Airbnb Hosts

The Kenya Revenue Authority (KRA) has contacted Airbnb, the online platform for short and long-term homestays, in a bid to crack down on tax evasion among Kenyan hosts.

Airbnb Ireland UC, acting as the data controller for Airbnb Kenya users, has received a request from the KRA for transaction data spanning from January 1, 2021, to December 31, 2022. This request aims to uncover the identities and earnings of hosts. Consequently, the Irish Revenue will inform every Kenyan user about the sharing of their data with the KRA.

“KRA has issued an exchange of information request to the Irish Tax Authority-Irish Revenue, seeking certain information on Kenya hosts, and Irish Revenue has formally requested Airbnb to share this information, which we are legally obliged to,” Airbnb disclosed in a statement.

The KRA will evaluate taxes and may send tax requests to Airbnb hosts based on the gathered information. Kenya's involvement in the African Initiative, led by the OECD Global Forum on Transparency and Exchange of Information for Tax Purposes, demonstrates its dedication to fighting tax evasion and increasing tax income through information exchange. Although the current rental income is substantial, it is expected to decrease to 7.5 per cent by January of the upcoming year.

Data received from Airbnb would aid the KRA in pinpointing additional rental properties that would be eligible for taxation. Conversely, Airbnb is obligated to pay a 1.5% digital services tax based on the total transaction value, excluding VAT. The KRA's request for information from Airbnb has not yet been authenticated.