Kenya Slashes Gambling Tax

Kenya Slashes Gambling Tax ( Click to Enlarge )

Online casinos throughout Kenya will be celebrating as the Kenyan government recently approved a reduction in gambling tax from a whopping 35% to a much more amenable figure of 15%.

Government Tension

The move came after a tense time within the government.

The Finance Bill 2018 was rejected by Kenyan President Uhuru Kenyatta, who declared that he wanted to see the rate cut as part of the bill. The bill was then finally approved during a tense sitting in parliament on 20th September 2018.

Kenyan legislators agreed on an increase of their gambling tax to the astronomical figure of 35% back in the summer of 2017 in a bid to cut the rate of gambling among young people in the country.

At the time, this represented an increase of over five times the original figure, which was only 5%.

A lot of operators were forced to halt their operations in the country because the rate, which was implemented on the 1st January 2018, was just untenable, given that they were already paying 30% corporate income tax.

Online Tax Burden Recognised

President Kenyatta has not always been against this increase, having authorised it in the first place.

He has, however, since seen the light and has previously gone to parliament to request a cut to the gambling tax, although he has not been successful until now.

It seems that many within the Kenyan government felt strongly that a high tax was in order to reduce the perceived negative social impact that some believe gambling causes.

Customers May Foot Bill

It isn’t all great news for online casinos, however.

The tax is now to be split between them and their customer, which could have an impact on the number of bettors wanting to try their hand at casino games.

The new tax will see the casino paying 15% as the gambling tax and customers paying a 20% tax on any winnings that they make.

The government feels that this new split-tax system will still generate plenty of income for their coffers but will also make it a bit fairer for the online betting agencies.

The idea of taxing bettors isn’t exactly a new thing, indeed, a tax on winnings was approved back in 2016 but it has never been successfully collected due to technical issues.

Who knows players might still enjoy a bit of a reprieve while the collectors get their act together?