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“They Can See Every Transaction” Betting Firms Under Siege as KRA Starts Daily 1am Tax Collections

In sweeping changes that have seen the taxman tap into betting businesses' networks to facilitate real-time tax computation as the government seeks to curb rogue organizations in the sector, betting companies are now required to pay taxes daily by 1 a.m.

The Kenya Revenue Authority (KRA) has finished a trial that involved connecting its tax system with the gambling industry to keep track of the 15% tax on gambling, gaming, and lotteries as well as the 20% withholding tax on earnings that is regularly collected from bettors.

According to Chris Kiptoo, principal secretary for the Treasury, one of the innovations under the revenue administration was the unification of the systems.

On the opening day of a public hearing on the budget for the financial year 2023–24, Dr. Kiptoo stated that KRA has made these changes to tax administration for the best possible collection.

Dr. Kiptoo listed the development of a new, web-based, better VAT system, the integration of the KRA system with the gambling industry, and the mapping of rental properties as examples of these advancements.

KRA aims to collect Ksh 500 million per day from betting companies, given that the Treasury expects to receive Ksh 15 billion from gambling this year.

The government is aiming to take a larger share of the billions gained from the gambling frenzy, thus this is a part of the taxman's new digital strategy to enhance tax compliance.

To close the loopholes of tax leakages made worse by the 30-day time lag, the KRA has integrated its systems with those of around seven sports gaming companies.

Normally, all tax heads are paid after 30 days. However, by 1 am, when many Kenyans cease betting, the betting companies would have begun remitting the taxes they collect each day.

One of the sports gaming companies that participated in the interlink's pilot, SportPesa, acknowledged that it was already paying taxes.

“They can see every transaction because their system is interlinked with ours,” a spokesperson from SportPesa said.

Following the experiment, the KRA asked to have its systems connected to seven additional businesses. A source who asked to remain anonymous claimed that those who disobey have been threatened with closure.

Content created and supplied by: BrightonM (via Opera News )

Chris Kiptoo KRA Kenya Revenue Authority Kiptoo Treasury


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