The Kenyan government is working on a new proposal for its mobile money transfer tax, which would have the effect of extracting revenue from other mobile operators, and not just dominant operator Safaricom.

Finance minister Njeru Githae said a “minimum charge per transaction” will be introduced shortly. Such a charge would cover those operators which currently offer free money transfer services unlike Safaricom’s M-Pesa service, said the Star newspaper.

The government introduced the new tax earlier this month

Airtel and yuMobile do not charge when their subscribers send cash to users on the same network. Hence, the two operators have argued they should not be liable for the ten per cent tax charge.

Safaricom has absorbed the ten per cent charge for transactions below KES100 ($1.1) but has introduced it for higher amounts.

“The concern is about those offering free services as there is always a cost associated with transferring money. So with the minimum charge it’s up to the company if it will still want to meet the cost,” said Githae.

“This will ensure one company will not be at a disadvantage compared to the others,” the minister said.

The new tax, which came into force on 8 February, covers all money transfer services provided by mobile operators, banks, money transfer agencies and other financial service providers. The government hopes to raise KES4.5 billion from the charge.