The government has increased the tax on betting and gaming stakes from 7.5 per cent to 12.5 per cent from July 1.
National Treasury Cabinet Secretary Njuguna Ndungu said on Thursday that the move is aimed at curbing betting among school-going children.
''Gaming and lotteries are addictive in nature and have negative social consequences in society,'' the CS said when he presented the 2023-24 Budget estimates.
The stake tax has been a long-standing subject of controversy, which was exacerbated by a decision to double the rate from 10 per cent to 20 per cent in 2019.
However, in 2020, the Parliamentary Finance Committee noted that the higher rate had led to lower tax revenue, in part as a result market exits.
The committee then proposed scrapping the tax entirely, a proposal that was accepted and signed into law by then-President Uhuru Kenyatta.
The National Treasury CS Ukur Yatani then immediately said that the tax should never have been scrapped and reintroduced it in 2021.
In the 2021 Finance Bill, the government set the excise duty at 20 per cent of the amount wagered or staked on betting products.
However, the Finance Committee again made changes, this time reducing the stake levy to 7.5 per cent which was then retained in the 2022 fiscal year and signed into law.
