This archive report was first published on 7 November 2019.
Kenya Revenue Authority Loses Tax Dispute with Sportpesa ¶
On November 7, 2019, the Tax Appeals Tribunal delivered a significant ruling in favor of Sportpesa, a leading betting company in Kenya.
The dispute began in 2018 when the National Treasury introduced a 20% tax on winnings, which led to a clash with betting companies.
Earlier, winnings were defined as the positive difference between the payout made and stakes placed in a given month, for each player. However, the exchequer changed the definition to mean the gross amount a punter walks away with after a lucky bet.
As a result, Sportpesa and Betin closed shop in the country following the protracted tax dispute with the Kenya Revenue Authority (KRA).
Between May 2014 and March 2019, KRA demanded KSh 61 billion from betting firms, while also hunting for KSh 8.59 billion tax arrears for Betin and Sportpesa from Safaricom.
The Tax Appeals Tribunal ruled that the taxman is only supposed to tax the positive difference between the gamer's stake and winnings within a month but not gross earnings.
