Betting, lottery and gaming companies will now have to remit taxes to the Kenya Revenue Authority on a monthly basis following the operationalization of the Finance Act 2016 clause on betting taxation.
According to KRA, the law came into effect on the first of January with betting, lottery and gaming companies expected to continuously make provisions for applicable taxes.
The betting firms, according to KRA, will part with 7.5 percent of the betting revenue.
Sportpesa, sports betting website owned and operated by Pevans East Africa Limited, will be the worst hit betting firm by the new law.
The betting company showed its financial muscle in July 2016 by announcing a three-year sponsorship deal with UK football club Hull City. This deal made history as it was the first time a Kenyan company was sponsoring a Premier League team.
Lottery operators will have to part with five percent of lottery turnover while gaming firms will contribute the lion share to the taxman by parting with 12 per cent of their revenues.
The new law will also affect the companies offering special promotions and prizes.
KRA will slapped them with a 15 percent tax on total gross revenue generated during the competition period.
In the current fiscal year, KRA has a Sh1.3 trillion target to meet. The KRA has seen the gambling business as very lucrative venture.
Millions of Kenyans have over the past two years taken to sports betting given the high payouts offered.
However lack of concrete data on the industry, estimated at Sh16 billion annually, has made it difficult for KRA to know exactly how much it can raise from the industry.
