Kenya has waived the 25 per cent import duty on Set-top boxes, the gadgets that convert analogue frequencies to digital, to enhance roll out of digital television broadcasting.
Kenya’s Finance Minister revealed the measure on Thursday when he presented the country’s 2012/13 national budget in parliament.
However the 16 per cent VAT charged on the product was not removed.
The tax relief is expected to bring the costs between Sh4,500 and Sh6,000 range down from the current rates of Sh8, 000 and Sh6,000.
Consumers need the device to receive digital TV signals via a standard aerial antenna from 2015, the deadline for switching off analogue signals.
On Thursday the Finance minister Njeru Githae said the removal of duty would enable the country meet the global deadline for the switch.
“To make the set top boxes which form an integral part of this migration available to Kenyans at affordable prices, i propose to remove the duty on the importation of these gadgets,” said Mr Githae.
The Broadcasting industry has been pushing for the zero-rating of the gadgets that are central in the uptake of digital TV.
Majority of consumers in Kenya currently possess analogue TV sets which would automatically become obsolete once the country switches off analogue TV broadcasting.
The world through an agreement of United Nations’ International Telecommunication Union (ITU) had set June 2015 as the cut-off date for analogue broadcasting. Kenya is currently on pilot migration and aims to fully switch over by 2013 ahead of the global 2015 deadline.
Earlier Kenya had set 2012 as own deadline but unforeseen challenges saw the date moved forward.
The country’s industry regulator, Communication Commission of Kenya (CCK) had identified high cost of set-top boxes and low awareness among consumers as key barriers to their uptake by consumers.
With the zero-rating of set-top boxes Kenya will soon experience boom in the digital TV sector
The budget announcement also comes days after CCK said it is set to license 168 operators in the Pay TV sector which is currently dominated by DStv.
The regulator said the new providers would be licensed under the digital broadcasting regime, which is replacing the analogue platform.
The high cost of operation has partly contributed to the dominance of DStv and the collapse of new entrants like GTV and Smart TV. A CCK competition study released three months ago blamed exclusive content rights for stifling competition in the pay-TV market segment.
DStv has largely been riding on the exclusive rights it holds on key content such as sports, including the English Premiership League, to win a following of about three million subscribers in several African markets.