Kenya Court Upholds Betting Tax Regime Against Constitutional Challenge
A Kakamega High Court has rejected a constitutional challenge to Kenya’s betting tax structure, preserving the government’s authority to impose both excise duties on wagers and withholding taxes on winnings. The ruling settles a key legal dispute over the tax framework that generates significant revenue from the country’s gambling sector.
Court Rejects Double Taxation Claims
Judge Stephen Mbungi dismissed arguments that Kenya’s dual taxation approach violated constitutional principles. The petition, filed by advocate Edward Okwama in August 2023, challenged the 12.5% excise duty on amounts wagered alongside the existing 20% withholding tax on winnings.
“I find that the petition has no merit. All declarations sought are declined,” Judge Mbungi stated in his ruling. The court determined that excise duty on stakes and withholding tax on winnings represent separate tax categories, rather than double taxation of the same activity.
Enhanced Regulatory Framework Takes Shape
Kenya’s Parliament has meanwhile approved comprehensive gambling reforms through the Gambling Control Bill, which awaits presidential approval. The legislation introduces a KSh 100 million capital requirement for online operators and establishes real-time monitoring systems for all betting transactions.
The new framework includes a 15% tax on gross gambling revenue and monthly levies of up to 1% for addiction treatment programs. Advertising restrictions will limit promotional content to evening hours and require responsible gambling messages in 10% of all advertisements.
Recommended