Kenya’s betting industry has received a temporary reprieve after a parliamentary committee rejected a Senate proposal to introduce new taxes targeting the sector. The National Assembly Sports and Culture Committee ruled against the proposed excise tax on betting stakes and winnings, citing procedural concerns and potential economic implications.
The Senate had recommended a 15% excise tax on every betting stake and an additional 20% tax on winnings, making the latest attempt to increase government revenue from gambling activities. However, the National Assembly committee dismissed the proposal on the grounds that tax-related measures must originate from the National Assembly as per Article 109 (5) of the Constitution.
The decision brings short-term relief to over 200 licensed betting firms in Kenya, many of whom have faced mounting financial pressures in recent years due to frequent regulatory changes and tax hikes. However, industry players remain on edge, as the rejected tax proposals are expected to be reintroduced through the upcoming Finance Bill, set for parliamentary debate later this month.
Kenya’s betting industry already operates under strict taxation laws. Bettors pay a 20% withholding tax on winnings, while operators face multiple levies, including a 15% excise tax on bets, implemented under the Tax Laws (Amendment) Act, 2024. The sector has seen major firms exit the Kenyan market due to these high tax burdens, leaving a shrinking pool of operators.
Despite these challenges, the government has continued to push for tighter regulations on gambling, citing concerns over addiction and the financial well-being of Kenyan citizens. Lawmakers have long argued that high taxation is necessary to curb the rising popularity of betting, particularly among the youth.
While betting firms have welcomed the temporary relief, many remain cautious about the upcoming Finance Bill, which could see the reintroduction of the proposed tax hikes. Some stakeholders argue that excessive taxation could drive bettors towards unregulated platforms, reducing government revenue in the long run.
Meanwhile, financial experts are closely monitoring the situation, as betting revenues contribute significantly to Kenya’s tax collections. In a recent industry event held at the Radisson Blu Hotel in Nairobi, stakeholders from the banking, finance, and insurance sectors discussed emerging trends and the future of Kenya’s financial landscape.
As the country awaits the final decision on the Finance Bill, the betting industry continues to navigate an uncertain regulatory environment, balancing profitability with government oversight and public concerns over gambling addiction.