Tax revenues from the country’s 111 betting and gambling companies rose by 26.2 percent in the last financial year, growing to KShs. 24.2bn from KShs. 19.2 bn the previous year.
- The growth follows the integration of the companies onto the KRA’s tax system, which provides the taxman with real time access to their data.
- KRA collects taxes on revenue generated (15%), excise duty on amounts staked (20%), a withholding tax on winnings (20%), and a 15 percent turnover tax charged on gross earnings.
- The revenue body collected KShs. 2.407 trillion for the 23/24 financial year, an 11.1 percent growth from the previous year, but still short of ambitious targets.
According to Statista data from 2021, Kenya has the highest gambling participation rate among the youth in Africa at 83.9%. After a surge in the number of gambling companies, and the volume and value of bets, Kenya begun adding ‘sin’ taxes to the sector in 2019 as a way of raising revenues to offset the downsides of gambling and betting especially among the youth.
A year ago, the sector contributed KSh 6.64bn in excise duty, against a target of KSh 5.715bn. At the time, only 36 companies were integrated into KRA’s systems, and the taxman was getting ready to integrate 87 more. The system provides for daily visibility, and daily remittances, as part of a plan to tax at source on a real time basis.
Despite the heavy taxes, the lucrative industry has continued to attract new entrants. In just four months between September 2023 and January 2024, the sector’s regulator licensed 29 more companies. But some companies have also exited the market, including Betsafe, Betin, and Betway.
