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Kenya’s government is advancing plans to update its gambling laws and increase revenue collection from the sector, as it opens consultations on three landmark bills.
The draft Gambling Control Bill 2023 and the draft National Lottery Bill 2023 have been published on the recently created National Lottery Taskforce’s website.
Alongside the bills, the taskforce has also published a draft gambling policy for Kenya in 2023, which has yet to be finalised on its website at the time of writing as it is still missing parts such as the executive summary.
A call for written submissions on the draft bills, available to access on the taskforce’s website, opened on March 27 and is set to end on April 21.
Local media reports state that the bills will be included in the next Kenya Gazette, which is set to be published on March 31.
President William Ruto, who was appointed in September 2022, quickly established the Presidential Taskforce on the Establishment of a National Lottery via a gazette notice on February 17, to create the framework for the lottery as well as recommend comprehensive regulatory reforms.
Ruto told parliament soon after he was appointed that he would cut KSH300bn (€2.1m) from the proposed 2022/23 budget and made it clear that collecting more taxes would be a priority for his government.
The taskforce’s role in this is to recommend policy and legislative proposals to parliament that will “overhaul the gambling sector, with a view to positioning this critical industry as a positive force for social progress and advancement”, according to its press release on March 25.
“Inevitably, the new gambling framework will change the negative perceptions and connotations often associated with the sector,” the taskforce said.
The Gambling Control Bill includes updates to existing advertising, licensing and enforcement rules, covering all forms of gambling, including online.
Additionally, it would create a Gambling Regulatory Authority, which would replace the existing Betting Control and Licensing Board, which will have a wide range of tasks including issuing licences as well as monitoring and developing policies.
A Gambling Appeals Committee would also be established, which will operate as a quasi-judicial body for consumer and industry issues.
The National Lottery bill would establish the framework for the lottery draw and the distribution of funds, as well as the establishment of a National Lottery board, tasked with overseeing its operation.
A call for public input on the three draft bills explains that along with the written submissions, the taskforce will be holding scheduled meetings across the country’s different regions next month that it hopes industry stakeholders will contribute to.
In October 2022, Kenya’s government ordered gambling companies to remit their taxes on a real time or near real time basis via an Electronic Tax Invoice Management System (eTIMS).
A few weeks ago, a spokesperson for the Kenya Revenue Authority (KRA) told VIXIO GamblingCompliance that since the implementation of the directive in November 2022, “16 operators have been onboarded with tax collections to date amounting to over KSH$5bn (€36.1m)".
Comparatively, in June 2022, National Treasury figures revealed it managed to raise just KSH3.4bn for the year. The National Treasury had expected to raise KSH5.4bn.
The KRA expects that by the end of March 2023, all betting and online gaming operators will be transmitting both daily payments and transactions data, real time.
However, the government is unable to raise all the taxes it wants from the sector after a bombshell High Court judgment on January 31, 2023 forced the removal of a controversial 7.5 percent excise duty tax on gambling activities.
A key reason in the ruling was a lack of public consultation on the changes before they were implemented.
The excise duty was removed only for gaming and lotteries, while rates for betting and prize competitions were maintained.
The KRA has moved to the Court of Appeal to challenge the finding of the High Court.
Separately, today the KRA is hosting a forum in Nairobi on betting tax, aimed at providing stakeholders with information on the latest compliance information.
