And although most of the current digital service taxes are aimed at large mobile or Internet companies, startups are likely to see higher charges for the platform services they depend on, thereby hindering their expansion and general growth of the local ecosystem.
It is, therefore, imperative that governments rationalise taxation and resist the opportunity to view the innovation ecosystem as an easy source of revenue.
AfriLabs will continue to work with industry stakeholders and other partners to protect startups from excessive taxation, which may stall the progress made by African countries in digitalisation.
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