Thursday, June 8, 2023

KRA to Collect Sh 24 Billion From Betting Firms in FY22/23

The Kenya Revenue Authority (KRA) is targeting to collect sh 24 billion from betting firms in the 2022/23 financial year, up from the Sh 21 billion collected in the previous financial year.

The taxman on Tuesday revealed that it has so far collected sh 15.8 billion from the betting platforms, which include SportPesa, Betika, Betway, and Odibets, among others.

The high collection was helped by KRA’s various administration reforms employed to assist in sealing revenue loopholes. These include sharing of data between the taxman and the Betting Control and Licensing Board (BCLB) to enhance monitoring.

 KRA has also been betting on automation to net extra revenue in the sector. In November last year, the taxman integrated into its system a total of 16 major betting firms, which it says contribute an estimated 90 percent of the total taxes remitted by the betting sector.

The integration helped KRA to monitor real-time betting transactions compared to previously when it would wait for over a month to see what the taxpayer would voluntarily self-assess.

Read: KRA Suspends payment of tax relief to enhance the process

Since the integration, KRA has collected over Sh. 5.8 billion in Withholding tax on winning bets. This is an increase from the sh 5.7 billion in Withholding tax on winnings collected In the year ended June 2022, before technology integration.

Withholding tax means tax remitted by the source to the commissioner on behalf of the recipient. KRA’s withholding tax on winnings is calculated at 20 percent, while Excise Tax on stakes is calculated at 7.5 percent.

According to KRA Chief Manager Domestic taxes Miriam Sila, Kenya has around 170 licensed betting firms, but only 16 have been integrated into the tax authority’s systems.

Sila noted that the authority is working on onboarding all the active Betting and online gaming firms across the country.  She was speaking on Tuesday at a Nairobi hotel during a sensitization forum on the betting tax integration.

She added that Some 20 companies have been identified for onboarding, highlighting a revenue jump in the sector.

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