Betting Control and Licensing Board chairperson Jane Makau and Association of Gaming Operators chairman and Mozzart Bet CEO Sasa Krneta/SCREENSHOT





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Kenya's betting industry players now want a stable tax environment to support locally licensed firms lest the industry is hit by closures amid a rise in access of the local market by “grey firms”.

A “grey firm” or “grey market” refers to an unofficial or unauthorised market for goods or services that are not illegal but operate outside the official distribution channel, meaning these companies do not pay taxes in Kenya.

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This is in the wake of continued raid by the government on the local betting industry which has traditionally targeted sin tax as a low-hanging fruit, in addition to the pay-slipped working population.

Through the Association of Gaming Operators of Kenya, industry players which is pushing to rid of illegal gambling said heavy taxation could see more companies shut down, after at least 10 closed shop last year leading to massive job losses both directly and indirectly.

The gaming industry, which contributed over Sh24 billion last year in taxes, believes this could be higher in coming years with support from the government in attaining a level playing field and a stable tax environment.

“There is need for fair tax policies and playing field to sustain the industry and revenues to the government,” AGOK chairman Sasa Krneta said during the lobby group’s annual executives gala in Nairobi.

There are at least five major betting sites that have free access to the Kenyan market.

“We have gambling companies who are in a different jurisdiction but still access the Kenyan market.It gives them an advantage because they don’t pay taxes in the local market. They use aggregators for payment channels like M-Pesa and they find the ways, customers are able to make deposits for those websites, which they don’t have licence in Kenya,” Krneta said.

The betting industry attracts an excise tax of 15 per cent on stakes, withholding tax 20 per cent on net winnings and a betting and gaming tax of 50 per cent which is on gross gaming revenue for operators.

This is an addition to corporate tax and other statutory deductions.