Kenya has officially signed a 7.5% tax on gambling stakes into law. This is a 12.5% drop from the initial amount proposed back in June.
A back and forth
On June 29, Kenyan President Uhuru Kenyatta signed a bill that proposed to reintroduce a 20% excise tax on betting stakes. This was an increase from the 10% suggested in 2019. This move was the final straw for a number of operators and led to Sportpesa and Betin vacating the market.
The 2020 Finance Bill saw the country’s Finance Committee suggest removing the tax entirely. It argued that the tax increase pushed operators out of the market and, as a result, the Treasury had collected less tax income. This amendment was approved by Parliament and signed into law by Kenyatta who has remained firm in his stance against the industry.
The latest figure
The 20% tax was eventually brought back but the Finance Committee rejected the offer yet again. It then proposed lowering it to 7.5% and applying it to lotteries as well as betting. It argued that this would encourage players to continue playing on licensed sites.
When discussing the latest figure, it stated: “The committee observed that the proposed rate of excise duty on betting is too high and may end up not achieving the intended revenue as most players will opt for international platforms for their betting activities.”
A new lease of life for the Kenyan market
The proposal received three readings in Parliament and was eventually passed last week. The president then signed the bill into law this week.
After the 20% tax was repealed last year, Sportpesa returned to the Kenyan market under a new license by Milestone Games. The Betting Control and Licensing Board, however, argued that this operator did not have the rights to use the Sportpesa brand.
A High Court ruled that Sportpesa could return.
