Kenya betting operators win reprieve on proposed tax hike

Kenya’s sports betting operators are breathing a sigh of relief after legislators rejected plans to dramatically hike betting taxes, while retaining hikes for other gaming operators.

On Thursday, Kenya’s parliament voted down plans to hike betting operators’ tax obligations from their original 7.5% of revenue to 50%. The proposed change to the Betting, Lotteries and Gaming Act was part of the government’s Finance Bill, which sought to impose a uniform 50% tax on all gambling revenue, be it betting, lotteries or gaming.

Treasury Secretary Henry Rotich said the proposed tax hikes were intended as both a revenue generator for the government as well as a means of discouraging gamblers from going overboard. But betting operator SportPesa mounted a legal challenge based on the argument that the hikes, which were on top of operators’ corporate tax obligations, were unconstitutional.

On Wednesday, members of the Assembly’s Finance Committee rejected the tax on betting operators, issuing a report that said the rate was “punitive enough to discourage such activities.” The report was met with opposition from government representatives, who urged Assembly members to stick with Rotich’s plan for the good of society.