Government collected Sh4.7 billion as tax from betting companies

Government collected Sh4.7 billion as tax from betting companies
  • KRA oppose Betting, Lotteries and Gaming (amendment) Bill
  • The taxman says increase in levies to betting companies will make them relocate to neighbouring countries
  • The proposed Bill the betting tax might increase from the current 7.5 percent to 15 percent making the Kenya to have the highest betting tax as compared to Tanzania, Uganda, Rwanda and Ghana.

 The eight betting companies in the country remitted Sh4.7 billion as tax to the government in the last three years.

The Kenya Revenue Authority (KRA) yesterday said taxes from the betting companies has continued to rise steadily since 2014/2015 financial year.

In 2014/2015 financial year, the taxman collected Sh 120 million, in 2015/2016 it collected 1.2billion while in 2016/2017, KRA collected Sh3.3 billion from the betting companies.

READ ALSO: Gem Member of Parliament Jakoyo Midiwo says betting can collapse the country’s economy if not well regulated

“As you can see there has been an increase in payments of taxes in the last one-and-a-half years,” Njiraini said yesterday.
Appearing before the Parliamentary committee on labour and social welfare KRA Commissioner-General John Njiraini opposed any increase on levy or other tight rules to the betting companies.

Njiraini warned that any increase on the levies to the companies might make the betting firms to relocate to neighboring countries with favorable business environment.

Njiraini said if the Betting, Lotteries and Gaming (amendment) Bill sponsored by Gem MP Jakoyo Midiwo sails through the National Assembly it will increase the exchequer revenues but the benefits would be short-lived.

In the proposed Bill the betting tax might increase from the current 7.5 percent to 15 percent making the Kenya to have the highest betting tax as compared to Tanzania, Uganda, Rwanda and Ghana.

READ ALSO: Betting firm offers professional financial advice to Sh20 million jackpot winner

In Africa it’s only Ghana that charges 17.5 percent as betting tax.
Njiraini urged the committee to retain the current existing taxation regimes to determine the most appropriate regulatory and tax structure of an industry that will balance between social, revenue collection and investment priorities.

“This betting industry is very fluid and therefore I propose that the current existing taxation be maintained,” Njiraini said.

Currently the betting tax is 7.5 percent, lotteries tax is 5 percent, gaming tax is 12 percent and the prize competition tax is 15 percent.

“KRA generally recommends simplification of legal regimes for ease of tax administration. Complex regimes generally complicate tax administration and encourage evasion,” he said.

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