•In the past four months KRA has netted Sh5.8 billion from the leading 16 players since November 16.
•Previously all the tax heads were paid after 30 days. However, the betting firms have now been remitting the taxes they collect every day by 1am.
Image: JACKTONE LAWI
Kenya Revenue Authority(KRA) is looking to integrate 20 more betting firms into its real-time tax tracking system as it looks to collect Sh24 billion by the end of the year.
The taxman has already collected 94 per cent of taxes from the betting industry since the adoption of real-time tax payments in November last year.
In the past four months, KRA has netted Sh5.8 billion from the leading 16 players since November 16 when the taxman began the daily collections.
In the current financial year 2023-2024 KRA has already collected more than Sh15.8 billion or just about 65.8 percent and will be looking to ramp up collection measures to hit the Sh24 billion target.
According to KRA chief manager for Domestic Taxes Miriam Sila, the 16 players included in the first phase of the for integration exercise account for 90 percent of the taxes in the sector.
The taxman introduced the daily collection of the 7.5 per cent excise duty on stakes and the 20 per cent withholding tax on winnings from these companies to allow real-time computation of taxes and increase revenue collection.
“We are working on the third phase to integrate 20 more companies in our platforms to grow our collections, once this is done, we will have 96 per cent of the companies remitting excise and withholding tax on winnings daily,” said Sila.
Compared to the last fiscal year ended June 2022, when the taxman collected Sh5.7 billion in Withholding Tax (WHT) from winning bets, the technology integration, has seen the figure rise to Sh5.8 billion in four and half months.
“In the next phase we will have around 26 firms on board giving us 96 percent of the revenues in this sector,” added Sila.
The target this year will be KRA’s highest ever after netting Sh21 billion last year which was a growth from Sh17 billion recorded in 2021.
Speaking during a sensitization forum on the betting tax integration, Sila noted that the integration is expected to double the collections as the taxman now has visibility of real-time betting transactions.
In the first phase, KRA linked its systems with those six sports gaming firms, in what it said was aimed at sealing the loopholes of tax leakages that were exacerbated by the 30-day time lag.
In January the taxman included 10 more betting firms into the system and in the second phase KRA revealed that plans are at the advanced stages to finalise the process.
Previously all the tax heads were paid after 30 days. However, the betting companies have now been remitting the taxes they collect every day by 1am when a lot of Kenyans stop betting.
“Daily remittance of the taxes and daily transmission of data to KRA means that the authority can use the data to monitor what the industry is doing and its performance,” she pointed out.
As at Tuesday morning the collections were at 92 percent collection for March and 94 percent cumulative for the year.
The Kenyan gaming industry is estimated to be holding around Sh50 billion in gross turnover as of June 2022, with over 170 licensed firms operating in Kenya.
Online betting and gaming are the most popular products offered in the Kenyan Market.
This has ranked the country among the leaders in sub-Saharan Africa with a growing market in betting and gaming.