Parliament in Kenya has rejected plans by local gambling operators to offer them a break from their recent tax hike, dealing another blow to local sports sponsorships.
According to a report in Business Day last week, the National Assembly committee on Labor and Social Welfare had withdrawn proposed amendments in legislation and was seeking to amend to the recently revised Betting, Lotteries and Gaming Act. Had the proposal been accepted, it would have seen the uniform tax rate reduced to 15% while player winnings would be taxed by 20%.
The Act, that was changed last summer to impose a uniform 35% tax on all gambling revenue, resulted in notable increases in taxation on Kenyan betting operators who were previously paying a tax rate of just 7.5%. The changes took effect on 1st January 2018.
It was reported that the rate was raised in order to protect players and discourage betting expansion in Kenya but the move has resulted in the market in Kenya becoming unappealing to several operators, who are now considering pulling out of the country.
Kenya is said to be one of the most mature online betting markets in Africa and last month a Nielsen survey found that online penetration in Kenya was 27% which was much higher than neighboring Tanzania (5%), Uganda (4%) and Rwanda (2%).
Kenya’s online gaming market scored second on the penetration list with 19% which was narrowly outdone by Rwanda’s 22%.
It was also claimed that SportsPesa was the most popular online betting operator in Kenya with 82% of local betters having an account with the operator.
