Kenya mulls (again) hiking betting tax rate by another 10%

Kenya’s government is once again proposing a significant hike in gambling taxes but the nation’s leading sports betting operator says the sector is already one of the country’s highest taxed industries.

Last week, Kenya Revenue Authority (KRA) commissioner-general John Njiraini tabled a raft of proposed new tax hikes, including an additional 10% excise duty on the country’s licensed betting operators. Njiraini claimed the hike was necessary because sports betting has “negative effects” and the taxes currently imposed on the sector “are inadequate.”

Claims of gambling’s negative effects on society were also what prompted Kenya’s government to hike taxes on the industry to 35% effective January 1, 2018. However, the government climbed down off its moral high horse last September, reducing betting operators’ tax rate to 15% while imposing a new 20% tax on bettors’ winnings.

Kenya’s Treasury is still mulling Njiraini’s proposals, but it’s hard to see how the government will sell the betting tax hike, given the embarrassment it has already suffered via its repeated flip-flopping on this issue. Then again, the KRA says its current fiscal year’s revenue collection is on pace to come in Sh110b (US$1.1b) below its target, and desperate times call for desperate measures.