- New estimates reveal 70% tax proposal on all Kenyan gambling operators
- Major plans by the Kenyan government force need for an extra $1.83bn in taxes
The Kenyan Government has announced that all casino companies will have to pay a standard 50% rate of tax on all revenue, as reported last week, as well as a 30% rate of corporation tax; meaning firms could lose between 70% and 80% of overall revenue to tax.
Such a steep percentage would come as a blow to any manner of company, but bookmakers would have felt the sting even more seeing as up until now they have only been subject to 7.5% tax.
The Kenyan Treasury Secretary, Henry Rotich, has cited a number of reasons for this decision. Amongst these were the perceived negative effects that problem gambling has on their society; in particular he mentioned youths and vulnerable persons.
At the same time they have big plans to fund greater expansion into the nation’s sports, culture and arts.
These new projects as well as other plans mean that the government is looking to raise a further $1.83bn in the 2017/18 fiscal year. They currently only draw in around $46m in betting taxes, so it appears they have decided it is the casino operators who will go a long way in catering towards the governments optimistic plans.
The betting operators have not yet responded, but it is expected that their reaction will be nothing short of disgust and outrage. This comes from the fact that they were adamantly defiant against a proposed increase back in February* that would have pushed taxes to 15%. So with an increase of up to net 70%, it is unlikely the casino companies will rollover and meekly accept this decision.
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