This alert brings to your attention the recent Tax Appeals Tribunal’s (the Tribunal) judgment in the case of Google Kenya Ltd (Appellant) vs. Commissioner of Domestic Taxes (Respondent) on the disallowed VAT refund on the ground that the services were consumed in Kenya and not exported.


The Respondent conducted a VAT refund audit to verify the tax compliance status of the Appellant for the period between February 2010 and February 2013. Following the audit, the Respondent disallowed the Appellant’s VAT refund claims of Kes 58,753,106. Aggrieved by the Respondent’s decision, the Appellant appealed to the Tribunal, which appeal and subsequent decision form the basis of this alert. 

The Appellant’s Case

The Appellant’s case was based on the nature of services they provided to Google Inc. (USA) and Google Ireland. The Appellant contended that the services provided to Google Inc. were Research and Development (R&D) services and those offered to Google Ireland were marketing and support services. The Appellant contended that since these were provided to related non-resident entities, they were exported services and subject to VAT at zero rate. The Appellant further argued that Kenyan customers contract directly with Google Ireland for the products.