Blowing Money Fast!
No industry has captured the imagination of the Kenyan economy in the past three years like betting. Concerned about its runaway growth, the government imposed higher taxes but the proliferation of gaming outlets across the country continued.
The government, through the Kenya Revenue Authority, then turned to gaming equipment: No more importation unless authorised by the Betting Control and Licensing Board (BCLB).
“Any further importation of such gaming devices must have express clearance from the Ministry of Interior and Co-ordination of National Government,” said a KRA statement.
BCLB chairman Anthony Kimani Kung’u told The EastAfrican that the majority of the gaming machines entering Kenya do not meet international standards.
“Restricting importation is part of our fight against illegal machines, mostly from China,” he said.
He added that the move is to ensure that unscrupulous businessmen do not take advantage of unsuspecting Kenyans. There has been a proliferation of gaming equipment in estates and other social places.
Backstreet gambling dens
According to the chairman of the Association of Gaming Operators of Kenya, Ronald Karauri, the increase in the machines has tarnished the image of the betting and gaming industry.
“As an association, we have been telling BCLB to crackdown on these machines because they are encouraging irresponsible gaming,” he said.
Mr Karauri, who is also the chief executive of sports betting firm SportPesa, added that lack of a modern and progressive law to regulate the industry is fuelling the growth of backstreet gambling dens.
Currently, the industry operates under the Betting, Lotteries and Gaming Act, which stakeholders contend is outdated owing to the evolution of the industry particularly in the use of mobile and online platforms for betting.
Kenyan legislator Jakoyo Midiwo drafted the Betting, Lotteries and Gaming (Amendment) Bill, 2016, to provide a legal framework for regulating and controlling gambling activities.
The Bill also seeks to promote the development of a responsible industry, protect young and excluded persons from the negative effects of gambling and prevent gambling from being a source of crime and from being used for money laundering.
The Bill has however met with opposition from BCLB and industry players on the basis that it does not incorporate the views of stakeholders, and that it is intended to end gambling.
“While we agree the industry needs a modern law, the Bill is not sincere in its object of regulating but will only kill the industry,” said Mr Karauri.
Kenya currently has more than 30 licensed betting firms and casinos, although only a few are in operation.
A recent report by PricewaterhouseCoopers shows that the yearly turnover of the sports betting industry in Kenya is worth $20 million, and will reach $50 million in 2020 as demand grows.
The formal Kenyan betting industry, which paid $28.3 million in taxes in 2015, is ranked third in Africa after South Africa and Nigeria.
In the 2016/17 Finance Bill, the government increased taxes on betting, lotteries and gaming after introducing a betting tax charged at a rate of 7.5 per cent of the gaming revenue, lottery tax chargeable at a rate of five per cent and a gaming tax chargeable at a rate of 12 per cent of the gaming revenue. Source – Njiraini Muchira.
