Twitch pulls monetization in Kenya, another casualty of Kenya’s chaotic digital tax policy

Twitch has suspended all monetization in Kenya, ending Partner and Affiliate payouts and leaving local streamers with no way to earn on the platform. The company cited “recently imposed regulations” that restrict its ability to support monetization programs in the country. The news first surfaced via a screenshot shared by Kenyan Twitch streamer Sylvia “Queen Arrow” Gathoni.

Why this matters

For years, Kenyan policymakers have layered new digital levies without a coherent plan for growth. Non-resident platforms must register for VAT on electronic, internet and digital marketplace supplies at 16%. Kenya also subjects digital content monetization to withholding tax at 5 percent for residents and 20 percent for non-residents. Even as government repealed the old Digital Service Tax, it replaced it with a Significant Economic Presence tax, now set at 3 percent and recently expanded in scope. Each piece on paper may seem minor. Together, they create friction and uncertainty that global platforms read as risk.

The knock-on effects you feel every day

These policies do not live in a vacuum. If you buy Facebook ads in Kenya, Meta adds 16 percent VAT to your bill. If you subscribe to AI tools like ChatGPT, OpenAI now charges 16 percent VAT in Kenya from May 2025. Productivity suites are sold in KES and fall under the same VAT rules for electronic services. Meanwhile, internet data still carries excise duty, which lawmakers tried to raise in 2024 before Parliament kept it at 15%. Taxes stack, costs climb, and creators plus small businesses pay first.

The human workaround, and the chilling effect

Faced with higher prices and platform retreat, many Kenyans say they are either changing billing regions or simply stopping spend altogether on subscriptions and ads. You can see it in public chatter around VAT on ChatGPT and broader frustrations with digital taxes. None of this is healthy. It pushes people into grey zones, starves the formal economy, and shrinks the local creator and startup ecosystem that policy is supposed to nurture.

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What government should fix now

Kenya needs predictable, growth-minded digital tax policy. Start with clarity and stability on Significant Economic Presence tax and VAT compliance so platforms can plan long term. Protect consumers by avoiding surprise hikes on core inputs like data, which power online work. Engage platforms before rolling out rules, and publish impact assessments so changes are evidence-based, not headline-driven. Otherwise, more companies will follow Twitch’s lead, and Kenya will keep exporting opportunity.

We have covered this trend for years. When Meta began charging VAT on ads in 2022, we warned it would raise acquisition costs for Kenyan businesses. When OpenAI announced VAT on ChatGPT in 2025, we flagged how policy contradictions hit AI adoption. Those signals are now flashing red.