Nepal announced issues with taxes in March, now Kenya is stating they are changing taxes in the gambling sector. Nepal was targeting casinos that were lax in paying their taxes. They told the casinos the government would wait three days for taxes to be paid properly or legal action would begin. Kenya’s tax changes are not the same. Instead of casinos being targeted, it is the gambler.
Gamblers living in Kenya will need to pay 20 percent on their winnings. Those who play the games are not happy to learn about the percentage. Thursday, April 19, 2018, local media reported that the government of Kenya is creating new tax laws under an amendment bill 2018. The bill is proposing a tax increase of 20 percent on game, betting, and lottery winnings.
The bill is asking for operators to withhold the 20 percent. A similar system was taken out of the laws in 2016 due to problems such as implementation. However, the government seems to have solved their 2016 issues.
The bill is part of a January 1st change to tax gambling operators’ revenue. The amendment states gambling operators must pay 35% more on their winnings, whereas sports betting operators only see a 7.5 percent raise in taxes. The lottery paid 5% of the revenue. Pambazuka National Lottery stopped providing their product when the 35% change occurred.
Many of the operators are contesting the changes and suspending activity, but it seems the government is still going ahead with their plan from last summer regarding operators. The other thought is the winnings percentage charge for gamblers may offset the operator taxes, which would be lowered a small amount.
Kenya’s government is not specific as to why they began the legal process to increase gambler’s winnings. There is the thought that youth are starting to participate and it may be a deterrent for them. More information is bound to appear as the bill goes through the government bureaucracy. For now, all that can be said is the tax hike would make plenty of gamblers unhappy.
The Gambling Market
A basic guide outlines Kenya’s gambling rules. Kenya has been one of the quickest growing markets for gambling in recent years, with online and land-based casinos. Kenya is trying to bring their laws up to date, and find ways to ensure gambling addiction is kept to a minimum. The new taxes may be one way they are trying to do this.