Kenya Revenue Authority (KRA) has requested that the Betting Control and Licensing Board (BCLB) terminate the trade licenses and paybill numbers of SportPesa and Finix Casino.
On November 8, weeks after the Kakamega High Court ordered the companies to stop deducting the 12.5 percent tax on wagering stakes, the KRA wrote to BCLB.
Okwama had filed lawsuits against the Attorney General, KRA, Milestone, and Standard Global. He said in the lawsuit that the existing legislation is unjust since it deducts money out of consideration regardless of a player’s win or loss.
He adds that in cases where sports are halted by natural disasters like storms or heavy rain, there is no legal provision for reimbursements of taxes withheld.
Excise duty should apply, according to Okwama, if there is income or winnings. He claims that it is against the principles of taxation to demand payment when there is neither profit nor income.
He claimed that the government’s demand for an excise tax on bets is discriminatory because it does not apply the same standard to other industries. KRA BCLB SportPesa Finix License
He bemoaned the fact that wagers that pay tax and then lose are a double loss. He pointed out that the existing tax system is unduly difficult, resulting in double taxation because gamblers have to pay a 20 percent withholding tax on earnings in addition to a 12.5% tax.
While the court’s ruling provided players on the SportPesa and Finix Casino platforms with a brief reprieve, it also put the two companies in direct conflict with the tax authorities.
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The Kakamega High Court ruling was contested, according to the KRA, which also claims that additional orders were issued compelling businesses to prepare for the excise tax in August.
Both taxpayers have not complied to the court order despite our reminders dated September 29, 2023. We hereby request you to kindly but urgently suspend all trading licences and pay bill numbers for SportPesa and Finix Casino until further notice.
Weldon Ngeno, Commissioner for Domestic Taxes
In a November 17 letter, BCLB chairperson Jane Makau requests an explanation from Milestone Games CEO Ronald Karauri about why his company disregarded a Kakamega court ruling that prevented the deduction of 12.5% excise from winnings, which was secured by a betting enthusiast named Edward Okwama. KRA BCLB SportPesa Finix License
As you are aware, all licenses are required to hold valid tax compliance certificates by the 2023/24 financial year licensing requirements and regulations as issued by the board by Section 5 of the Betting, Lotteries and Gaming Act.
Jane Makau, Chairperson BCLB
However, BCLB has not complied with KRA’s request, and customers are still able to deposit money into their accounts by utilizing the two companies’ paybill numbers.
Source: The Star KRA BCLB SportPesa Finix Licenses
