Kenya To Impose 20% Tax On All Gambling Winnings

Wagerallsports

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Kenya to impose 20% tax on all gambling winnings

BY Steven Stradbrooke ON April 19, 2018


Kenya’s gamblers are crying foul after the government revived controversial plans to impose a 20% tax on gambling winnings.

On Thursday, local media reported that Kenya’s government had tabled a draft of the Tax Laws (Amendment) Bill 2018 in Parliament on Wednesday. Among the bill’s more controversial provisions is the imposition of a 20% tax on all lottery, betting and gaming winnings.

Assuming the new Bill is adopted, Kenyan gambling operators would be required to withhold 20% of players’ winnings on behalf of the taxman. A similar withholding system was abandoned in 2016 due to myriad problems associated with its implementation but the government appears confident that it has now sorted out these issues.

The draft Bill follows the imposition on January 1 of the new uniform 35% tax on gambling operators’ revenue. Kenyan sports betting operators, who had been paying only 7.5% tax, vigorously protested this change, saying it made their business untenable and would force them to pass on the costs to their customers.

The Pambazuka National Lottery, which had been paying only 5% tax on its revenue, suspended its Kenyan operations the same week that the tax kicked in. Both Pambazuka and sports betting operator SportPesa filed legal challenges of the new tax, based on their claims that the law was unconstitutionally approved last summer.

It’s unclear whether the government intends to use the new winnings tax as a means of reducing the tax on operator revenue. Operators have been trying to lure the government to the negotiating table to find some way of reducing their tax burden and ensuring that Kenyan-licensed operators can still compete in the local market.

However, Kenya’s government claimed last summer that its tax hike was intended to temper the growth of gambling activity in the country, particularly among local youth. The winnings tax would appear to be a further step toward reducing gambling’s appeal.
 

BMR_Brad

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I wonder if the tax on winnings also allows losses to be taken into account as deductions?

I doubt it very much.
 

soccer star

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dont wager there...its hard enough to win let alone lose 20percent of you winnings !
 

DrDoom

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Is there any sense in betting like that? Yeah you could still make a wiining but some wagers would probably lose their worth. I mean, books should probably adjust their lines a bit to make it worth betting certain games.
 

Tart

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makes wagering useless...basically you are winning 80% of any bet...simply sad.
 

OfericSchim

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It is a ridiculous decision. It will ruin gambling in Kenya. In Kenya, persons whose estimated installment tax liability is lower than 1% of their gross turnover are required to pay minimum tax. It is worth noting that the tax relief introduced by the government for persons earning a gross monthly income of up to KES 24,000 per month continues to apply. I've always had difficulties finding the fillable form 1099-NEC. Luckily, at https://pdfliner.com/form-1099-nec I found the printable form of it and I've had no issues since.
 
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BMR Sandy

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This was 3years ago when they started implementing this?

I wonder how it goes after.
 

nicolacam

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Indeed, they will destroy the gambling business with this decision because there will be no point in it anymore. I hope the government comes up with something better. The methods of controlling all areas of financial activity have long been outdated and need improvement. Half of them cannot work correctly in today's world. Especially at such a rapid pace of technology development, the government needs to update its control mechanisms more often. Recently I was asked how to make your own pay stubs. People need paper statements because electronic ones are intermittent. It would be better if the government addressed this issue.
 
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