Bettors launch lawsuit against Kenyan gambling tax rises

A group of bettors have filed a lawsuit seeking to the stop the Kenyan government from imposing a 20% withholding tax on all sports bets by declaring it unconstitutional.

The group are calling for the rate to be reduced to its original 10% as initially proposed in the Kenyan Finance Bill 2019, claiming the Kenyan National Assembly acted unilaterally without the involvement of the public or stakeholders.

While the constitutionality of this claim is examined, the group are asking for the court to issue temporary restraining orders against the Kenyan Revenue Authority, stopping the implementation of sections 20, 21 and 23 of the bill.

Cecil Miller, the lawyer speaking on behalf of the punters, claimed the National Assembly subverted the Kenyan government’s mandate to impose excise duty as guaranteed under Article 209 of the Kenyan constitution.

The imposition of a 20% tax rate on all player bets came after a dispute between the Kenyan authorities and sports betting firms including SportPesa over the alleged non payment of Kenyan taxes by operators.

Kenya’s revenue agency and the government claimed operators had not paid over Ksh.4bn (£31m) in taxes, a claim which was disputed by operators. It ordered the country’s betting control and licensing board (BCLB) not to renew the licences of any operators until the outstanding taxes were paid.

The war of words between the government and SportPesa later led to the company ceasing all Kenyan operations, all sponsorships and effectively exiting the market at a cost of 450 jobs.

Fellow operator Betin, which had also been named among the firms not paying enough tax, closed down its Kenyan operations cutting over 2,500 jobs.

However, Betway received a new licence from Kenyan regulators after it agreed to impose the new tax rate on its bettors.

The case will be heard by Judge Weldon Korir at the Milimani High Court.