Kenya – SportPesa, Betin win tax row on bet prizes

The Kenya Revenue Authority (KRA) on Thursday suffered a blow after a tribunal ruled that a punter’s stake in a bet cannot be charged the 20 percent tax on winnings.

The Tax Appeals Tribunal sitting in Nairobi ruled that the 20 percent tax should be charged on the positive difference between the payout made and stakes placed in a given month.

KRA has been demanding billions of shillings from betting firms based on the gross amount of the payout to the punters, including the staked amount. The tribunal also placed a greater responsibility for payment of the tax on the punters, partially shielding the betting firms from prosecution and aggressive pursuit of the 20 percent withholding tax.

The tribunal’s verdict now looks set to tilt the ongoing tax dispute between KRA and more than 20 betting firm including SportPesa and Betin Kenya—which have been denied operating licences for the year starting July. KRA has been demanding Sh61 billion from the betting firms for the period between May 2014 and March 2019.

SportPesa on September 27 announced it was halting operations due to a drastic hike in taxes on betting stakes and the unresolved disputes with KRA. Betin Kenya also ceased its operations, citing the heavy taxation as the main reason.


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