enya Treasury Cabinet Secretary Henry Rotich has proposed a 10 percent excise duty on the amount staked in betting activities to curb problem gambling in the country, while reading the 2019/20 Financial Year Budget in Parliament on Thursday.
“Betting has become quite spread and its expansion has had negative social effect particularly to the youth and vulnerable members of our society, and in order to curtail the negative effect arising from betting activities, I propose to introduce excise duty on betting activities at 10 percent at the amount staked,” Rotich announced.
Before the new tax proposal on gamblers, betting firms shouldered all the burden of taxes as gamblers never paid anything when placing bet. Under the proposed new rules, gamers will pay 10 percent of the amount they want to bet upfront in excise duty, irrespective of the outcome of their prediction – win or lose.
The new tax bill is set to be separate to the bill that currently seeks to revamp the country’s regulatory framework for gambling. The development has elicited reactions from the Members of Parliament who disagreed with the official’s betting allocation.
“I am disappointed of taxation, betting has negative social effect for our young people and as National Assembly we suggested taxation should be 30 percent but today I was surprised the minister only increased by 10 percent, that will not cure the menace,” said Ndhiwa MP Martin Peters Owino.
“Gambling has destroyed our society and we cannot continue raising our children through guess work. I am so unhappy with position of the minister where he has taxed only 10 percent. He should have taxed more as he did with beer and cigarettes.
Kenyan legislators had confirmed that they are considering a proposed Gaming Bill 2019 which seeks to overhaul current state gambling laws, with further plans to impose significantly higher costs on licensed operators. Designed to replace the 1966 Betting Lotteries and Gaming Act, it seeks to cover the online operators across the Kenyan market that may not have otherwise been represented by the legislation.
Also addressed in the new proposals are stricter controls on advertising policies for operators, with gambling brands obliged to dedicate at least ten percent of their airtime to responsible gaming messaging. Gambling adverts will be banned from broadcast schedules between 6 AM and 10 PM, unless during live sports broadcasts.
A limit to how many adverts can be shown is also due to be introduced via the launch of the Gaming Advertisement Tax. The new tax will incur a 35 percent charge on all adverts broadcast, although it is yet to be clarified as to whether this tax will be handed to operators or broadcasters.