NAIROBI, KENYA – Thousands of Kenyan content creators earning from Meta's platforms, including Facebook and Instagram, will see their payouts reduced starting next year, as the technology giant begins deducting a 5% withholding tax on behalf of the Kenya Revenue Authority (KRA). The policy, set to take effect on January 1, 2026, brings Meta into compliance with Kenyan tax regulations targeting the rapidly growing digital economy.

In an email notification sent to affected users on Thursday, November 20, 2025, Meta stated that the change is a direct result of local tax laws. “Kenya tax law now requires all businesses to deduct and remit taxes to the Kenya Revenue Authority (KRA) for any payments made to creators located in Kenya,” the notice read. “As a result, Meta will deduct 5% withholding tax from all payments made to you.”

Payments processed from December 2025 will be subject to this new deduction. The company clarified that the tax will be reflected in the monthly remittance advice issued to creators, who will then receive the net amount in their bank accounts.

Alignment with the Finance Act 2023

Meta's action is a direct implementation of provisions within Kenya's Finance Act 2023, which established a withholding tax on income derived from digital content monetization. The Act mandates a 5% rate for resident creators and a more substantial 20% for non-residents. This legislation was a cornerstone of the government's strategy to broaden the tax base and ensure that individuals and businesses profiting from the digital marketplace contribute to national revenue.

The law defines digital content monetization broadly, covering income from advertisements on websites and social media, brand sponsorships, affiliate marketing, subscription services, and crowdfunding. The introduction of this tax followed significant debate, including an initial proposal for a 15% tax rate, which was later revised down to 5% after protests from local creators who argued it would be punitive.

Implications for the Creator Economy

Withholding tax is a method of collecting taxes at the source of income. For Kenyan creators, the 5% deducted by Meta is considered an advance payment of their total annual income tax. While the tax is remitted directly to the KRA by Meta, creators are still obligated to file their annual tax returns and can claim the withheld amount as a credit against their total tax liability.

This development formalizes tax compliance for a sector that has often operated in a grey area. The KRA has been progressively tightening its grip on the digital economy, having introduced the Digital Service Tax (DST) in 2021, which applies to services offered through digital marketplaces. The withholding tax for content creators is a more specific measure targeting individual earnings within this space.

The move by Meta is not an isolated event in the tech industry. Other platforms like YouTube have already implemented similar withholding tax mechanisms to comply with tax laws in various jurisdictions, including Kenya. Meta's compliance is significant due to the massive popularity of its monetisation features in Kenya, such as In-Stream Ads and Ads on Reels, which gained traction locally in the past year.

A New Reality for Digital Entrepreneurs

The implementation of this tax signals a new era for Kenya's digital entrepreneurs. As the government and its revenue agency become more adept at tracking and taxing digital income streams, creators must now factor tax obligations into their business models. The KRA's establishment of a dedicated unit to oversee tax collection from digital firms underscores this long-term strategic focus.

While the deduction will directly reduce the take-home pay for creators, it also streamlines the tax payment process for them, placing the onus of remittance on the paying platform. Creators have been advised by Meta to ensure their tax and business information, including their KRA Personal Identification Number (PIN), is correctly updated on their payout platforms to ensure accurate tax reporting. The deductions will be captured in official tax certificates accessible through the government's portal, allowing for transparent tracking.