Wednesday, 30 April, 2025
Finance Committee meets KRA over tax policy and administration in the betting and gaming sector
Bunge Tower
The Departmental Committee on Finance and National Planning, led by Hon. Kuria Kimani, Tuesday convened a meeting with officials from the Kenya Revenue Authority's (KRA) Commissioner General to discuss several key issues, including revenue performance, budget implementation, and the implementation of tax laws, as well as challenges encountered in the 2024/25 Financial Year.
Specifically, the Committee sought information from the KRA on:
-The current framework for taxing betting and gaming companies operating in Kenya;
-The classification and taxation of digital games of chance, including the Aviator game;
-The revenue performance of betting and gaming tax heads as of March 30, 2025, compared to the performance in the 2023/24 Financial Year;
-Measures in place to prevent tax evasion and ensure compliance by all industry players; and
-Recommendations and proposals for strengthening tax policy and administration within the sector.
During the meeting, KRA officials detailed the applicable taxes for betting and gaming companies, which include excise duty, withholding income tax, betting and gaming tax, and corporation income tax.
The Committee also received clarification that the Aviator game is classified as a digital game of chance and is taxed under the same regulations as other betting and gaming activities.
Regarding revenue performance, the Authority provided a detailed breakdown of revenue collected from betting and gaming tax heads for the 2023/24 and 2024/25 fiscal years.
This data indicated a 15% growth in total revenue collection for 2024/2025 (up to March 2025) compared to the previous financial year.
In response to the Committee's inquiry on tax evasion, the KRA outlined its strategies for prevention and compliance assurance. These measures include digital monitoring, real-time tax remittances, enforcement actions, third-party data collaboration, and public awareness campaigns.
To further enhance tax administration, the Revenue Authority proposed several recommendation among them increased collaboration with Mobile Network Operators, technological investments, comprehensive tax returns, legal reforms, multi-agency collaboration, and tax incentives for voluntary disclosures.
However, the KRA acknowledged several challenges within the sector, such as legal disputes, enforcement difficulties due to the sector's complexity, tax evasion, and the complexities of tracking and taxing online betting and gaming platforms.
To address these challenges and improve enforcement, the Authority urged the Committee to consider refining tax laws to close revenue loopholes and ensure all sector players fulfill their tax obligations.