Kenyan betting awaits Treasury judgement on wagering tax future

By | May 19, 2021

Kenya’s sports betting sector awaits a critical judgement on whether the National Treasury will restore its controversial 20% blanket tax across all wagering verticals.

 The tax proposal has been submitted to be considered as a directive of Kenya’s 2021/2022 National Budget, the final amendments of which are currently being reviewed by Treasury Secretary Ukur Yattani.

Yattani will present the National Budget reading on Thursday 10 June, according to a Treasury announcement, outlining new fiscal proposals to boost the state’s balance sheet, rocked by a year of pandemic impacts.

 The enforcement of a 20% tax imposed on all gambling verticals was first proposed as a measure of Kenya’s 2020 Budget by the Uhuru Kenyatta government.

At the time of the original proposal, the Kenyatta government was embroiled in a multi-million dollar high court dispute with multiple operators regarding unpaid taxes on player winnings.  

A last-minute injunction by Nairobi’s State House finance committee stopped the 20% tax from being imposed on the 2020 Budget, as it was deemed an illegal manoeuvre to double a tax-rate that had originally been settled at 10%.

Following consecutive years of regulatory conflicts, the Kenyan sports betting landscape has been radically transformed.

Disputes were brought to a boiling point in the summer of 2019, as the Kenyatta government ordered all national telecoms and financial services to terminate business services for licensed bookmakers.

Kenya’s Betting Control and Licensing Board (BCLB) were ordered to immediately terminate the licences of market leaders SportPesa and BETIN – with Kenya’s Revenue Authority (KRA) instructed to arrest all non-domiciles associated with the bookmakers. 

Since 2019, SportPesa has contested its BCLB licence suspension, launching multiple High Court challenges – which have been individually rejected.

Having changed ownership, SportPesa relaunched its business under the new management of Milestone Games – but the company was immediately forced to withdraw its operations as the BCLB stated that its shareholder remained unchanged, with outstanding KRA disputes.

Despite continued regulatory uncertainty, Kenyan sports betting has welcomed new incumbents joining its marketplace.

At the start of 2021, Betsson AB launched its Betsafe Kenya brand in partnership with BCLB licensed incumbent Bet High Kenya. 

Upon its entry, Betsson outlined its commitment to sustainable growth within Kenya, launching and promoting the market’s first safer gambling programme for players.