The Treasury has vowed to push for the reintroduction of excise duty on betting at a rate of 20 percent of the amount staked, in a move it says is aimed at curbing the rise of the gaming addiction among the youth.
Treasury Cabinet Secretary Ukur Yatani said the ministry would propose an increase of the tax from the current 7.5 percent in the next financial year, in what is likely to spark off hostilities with Parliament and betting firms.
Parliament in June rejected Treasury’s proposal of a 20 percent excise tax on betting stakes and lowered it to 7.5 percent on grounds that the tax regime on betting is too punitive and has put off investors
But Mr Yatani expressed displeasure with the lawmakers, saying that failure to approve the 20 percent tax has encouraged betting amid concerns from the State that the gaming addiction has entrapped youth into debts.
“We are not very happy with what Parliament did. Parliament in its own wisdom rejected the 20 percent but we will make another attempt through the Finance Bill,” Mr Yatani told the Business Daily.
The changes were contained in the Finance Act, 2021 that took effect from July 1.
Reduction of the excise tax is a win to gamblers but derails efforts by the Kenya Revenue Authority to raise more from the multi-billion industry that has grown over the years due to the gaming craze for popular sports like football.
Excise tax on betting stakes was introduced in 2019, but was removed in July last year through amendments to the Finance Act 2020 following lobbying by betting firms.
If i was Ukur chieth Yatani. Naweka tax 65%. Stima ikuwe na two types of payment. Industrial stima for production iko zero rated. Stima ya nyumba na pubs ikuwe 50%. Starting a manufacturing naweka hadi subsidy. Real estate 55% to discourage people to move in manufacturing. Mutumba naweka tariff ya 75%. Local clothing industry nawapea subsidies. Hivi ndivyo i will create 5 million jobs.
College learning time inakuwa from 8am to 2 pm. Hiyo time ingine students waendee works which will be created. Boarding school should be abolished. Kazi ya mwalimu ni kufunza sio kulea.
I support this move.
Idiots ready to part with their money freely ought to be taxed hard. Infact govt. Should share the spoils with the gambling companies 50 /50
He is on a fools errand. It’s one of the fears I have about growing old. Your mind becomes, lazy, rigid and unsophisticated. He thinks gambling is a cash cow, a short cut to hit his targets. He is the foolthat thinks, hmm,if I cut off a piece of the udder then I can bypass the cow and have direct access to the milk. Sorry old fools, that’s not how it works. You not only need the whole cow in order to get milk, you actually have to nurture and encourage the cow. They keep talking about capital flight of gambling profits. What about all the other mzungu industries that have capital flight too?
If I were them I’d even have encouraged Sportpesa to base its global business here. Do you know how much the gambling industry brings in for Gibraltar? Vegas? Macau? You don’t tax the cow. You tax the milk. But they are too lazy to figure out how to tax the milk, they think cutting off the udder is smarter.
Smart rebuttal, but to expect those shady Eastern Europeans to keep all that money in Kenya is wishful thinking. Alafu pia gava is desperate for revenue. This devolution thing is expensive as hell! Ongeza BBI juu if it ever passes and the government will be perpetually in the red
Very true .The retard keeps saying the tax will curb addition but he just wants to raise more taxes .If the government really wanted to do something about betting addiction there are so many instruments it can use with the most effective not issuing betting licenses .
True, but if you think just slightly beyond today’s stomach, you can realise that those shady Eastern Europeans have proved to have the mettle to hack it in an ultra competitive industry and they have global ambitions. Encourage them to base their worldwide operation in Kenya. Give them incentives and support to outcompete the global market. Tax their worldwide income in Kenya at a rate that leaves both them and KRA satisfied.
The tax is killing sports in Kenya. When Sportpesa was vibrant, sports in Kenya was doing well because of sponsorship. even the Kenya morans, the Kenya basketball team won a continental tournament. Harambee Stars qualified for Africa cup and prepared in Europe. The business of the betting companies is sports, so they have to spend their money on sports teams.
Other companies, when things start going south, the first thing they cut out is sports sponsorship. Zuleka gave up on boxing because of this.
The tax, if it is introduced should be in term of rebates for sport sponsorship. For crying out loud, , most of the team in England are sponsored by betting firms.
Kenya will lose out as bettors move to international betting sites
In the Premier League, eight of the 20 clubs are sponsored by betting firms - Burnley, Crystal Palace, Fulham, Leeds, Newcastle, Southampton, West Ham and Wolves - while in the Championship, which is title sponsored by SkyBet, it’s 12 clubs.
There are primary sponsors and secondary sponsors. I think all big teams in Europe have bookies as either primary or secondary sponsors. Pale Arsenal I know sportsbets as a secondary sponsor.