Kenya gambling tax issue on again, off again, on again

The saga of Kenya’s punitive 35 percent tax rate on operators and 20 percent tax on punter winnings continues as parliamentarians on various committees differ, it appears from local media reports over the weekend.

Our readers will recall that taxes were hiked from 7.5 percent to an across the board 35 percent of GGR at the beginning of the year, triggering protests from the industry that the new rate, added to heavy corporate taxation and mandatory donations to sport, made it difficult for businesses to prosper.

The national Treasury appeared to agree, suggesting that a reduction would be appropriate.

That was followed by a political proposal to cut the tax rate to 15 percent and resurrect a 20 percent tax on punter winnings which had been proposed but not imposed two years ago.

Whilst the proposal raised operator hopes for a sensible and final solution to the tax issue, these were soon dashed when parliament’s Labour and Social Welfare Committee failed to take the issue forward on a tax law amendment.

Now the Finance and National Planning Committee, which has review powers on tax laws, has supported Treasury in arguing that the operator tax rate should be reduced to 15 percent, and any punter winnings tax implemented should not exceed 10 percent.

Hopefully the committee differences will now be put to one side and the proposal from the Finance and National Planning Committee, backed by Treasury, allowed to go to the National Assembly for approval.

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