This archive report was first published on 4 November 2019.
On November 4, 2019, the Kenya Revenue Authority (KRA) issued a Sh1.75 billion tax demand to sports betting firm Betika, escalating a long-standing dispute between the two entities.
According to documents submitted to the Tax Appeals Tribunal, Shop and Deliver, the company that owns Betika, is fighting the tax demand, seeking to have KRA barred from enforcing the claim pending the determination of the case.
The taxman had written to KCB and Guaranty Trust Bank demanding Sh832.45 million from the firm's accounts for four months to December 2018 and a further Sh587.63 million for the period between January and February this year.
Additionally, KRA is demanding Sh328.1 million in accrued penalties and interest after the betting firm failed to comply with the tax directive.
"The matter is pending Judgement at the Tax Appeals Tribunal," KRA confirmed in a statement.
As a result of the dispute, Betika had started deducting 20 percent tax on customer winnings in compliance with a KRA directive in August, even as betting firms challenged the tax and the definition of winnings.
"We have no option but to deduct 20 percent on gross winnings" pending the determination of the case, Betika had said.
The dispute between KRA and Betika is the latest in a series of battles between the government and gaming firms, which has seen Sportpesa and Betin opt to close shop in the country this year.
More than 2,500 people lost their jobs after Sportpesa and Betin exited the market following similar battles with the taxman.
