Kenyan Govt Proposes to Increase Excise Tax on Betting Stakes to 20 Per Cent

The Finance Bill 2024, which will be presented in parliament and passed before June, is expected to be adopted by President William Ruto’s Cabinet. If the new amendment passes, punters will pay KSh 20 for every KSh 100 staked, up from the current KSh 12.5 Betting firms will also pay 15% of gross gaming revenue as taxes and a 1% monthly income levy to the Kenya Revenue Authority.

The government has proposed increasing the excise tax on betting stakes from 12.5% to 20%, which would be devastating to gamblers if it were passed.

What will gamblers pay?

President William Ruto’s Cabinet is set to adopt the Finance Bill 2024, which will be tabled in parliament and approved before June. If the new amendment passes, punters will pay KSh 20 for every KSh 100 staked, up from the current KSh 12.5.

“The first schedule to the Excise Duty Act is amended by deleting the words 12.5 per cent and substituting thereof the words 20%,” – part of the bill states.

Gamblers will stake a reduced amount, reducing their possible payout in case of a win. The law requires betting firms to deduct and remit withholding tax to the Kenya Revenue Authority (KRA) by the 20th of the following month. Firms will also pay the KRA 15% of gross gaming revenue as taxes and a 1% monthly income levy.

Market analyst advises gamblers

FX Pesa market analyst Rufas Kamau opined that if anyone wants to invest in betting, they should invest in private or public equity in a company that offers the services.

“If anyone wants to invest in betting, they should do what any informed investor does. That is, invest in private or public equity in a betting company. So, when people buy the products, you benefit by owning a proportionate stake in the company that offers those services,” – Kamau explained.

How much will betting firms pay?

KRA introduced changes to its tax system that will see the companies pay KSh 500 million daily at 1am after paying punters. The taxman interlinked the system with the firms to track the tax on betting and the 20% withholding tax on bet winnings. Treasury Principal Secretary Chris Kiptoo confirmed the integration of the system as part of KRA’s revenue administration reforms. KRA collected KSh 5.67 billion in withholding tax from betting firms in the financial year ended June 2022, down from KSh 7.09 billion reported during the same period in 2021.

Other proposals by Finance Bill 2024 The Treasury proposed a raft of taxes in the Finance Bill 2024 as the Kenya Kwanza government aims to raise more revenue for its budget in the 2024/25 fiscal year. Mobile money transfer services are set to rise after the excise duty was hiked from 15% to 20%. The government also used the roads to raise more money to fund its KSh 4.2 trillion budget; a motor vehicle circulation tax has been proposed in the bill.

Source: tuko.co.ke

About Post Author

Samuel

I am a journalist specializing in gambling in Africa and around the world. I am particularly interested in stories about games and casinos.

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Samuel

I am a journalist specializing in gambling in Africa and around the world. I am particularly interested in stories about games and casinos.