Kenya is failing to collect taxes on gambling

Even though legislation on the matter was introduced three years ago, the amounts collected are insignificant.

Kenya.- The African country’s government introduced a tax law targeting gambling, but after three years and a thriving industry, the revenue from taxes has been disappointing. A 20 percent withholding tax on betting was imposed by the National Treasury, but the implementation has not been successful so far.

Individual gamblers admit they have not paid taxes for their winnings, but they affirm the tax was supposed to come into force after January 2016. A senior officer at a casino explained that “individual winners go home with all their money. If you win Sh1 (US$ 9,800) million in a gaming bet, you will go home with your money intact. Casinos however pay the amount on a daily basis to Kenya Revenue Authority (KRA) officers on behalf of their clients.”

The 43 licensed casino operators in Kenya, which contribute with a gross annual revenue of US$18 million (Sh1.8 billion) apparently did not implement the tax measures supposed to take effect in January 1, 2014.

The Betting Control and Licensing Board (BCLB) wants the government to eliminate the withholding tax and to introduce a gaming levy instead, in order to targets the gross revenue of an operator. “This is one industry which is a sleeping giant. The gaming inspectors out there are compromised, government is not getting its fair share of revenue, and the good course money is also not collected as stipulated by the law,” said BLC chairman Prof Paul Wambua Musili.