Matiang'i hits out at betting firms, says taxes will be imposed to bring 'sanity'

Interior CS Fred Matiang'i has said the government will not go back on the decision to impose taxes on betting and gambling companies.

Speaking at the Kenya Institute of Curriculum Development on Friday, the CS said the government wants sanity to prevail in the country.

"This financial year, we have not licensed anyone... It was badly managed in the past that it almost broke our families," Matiang'i said.

"We want sanity to prevail in the country. We cannot allow criminals to do in our country what they cannot do in their own country," he said.

The government in 2018 introduced a 15 per cent tax on betting companies and 20 per cent withholding tax on punters winnings.

In 2019, it introduced excise duty on betting at 20 per cent of the amount staked.

On Thursday, Treasury CS Ukur Yatani claimed MPs removed taxes on betting.

He said the Treasury will propose the reintroduction of excise duty on betting in six months.

This was after President Uhuru Kenyatta signed the Finance Act 2020 into law.

The tax had been included in the previous year's budgets and was raised from 10 per cent to 20.

This increase led Kenya’s two largest operators, SportPesa and Betin - which were each already embroiled in tax disputes with local authorities at the time - to put a halt to operations in the country.

But on Thursday,  Yatani claimed that the excise tax was removed through the Finance Act 2020.

"The removal of this tax happened during the committee stage of the Bill," CS Yatani said.

 "The government remains committed to supporting the youth engage in productive activities through various programmes," he added.

While the tax remained in an initial version of the 2020 Bill, the National Assembly's Finance Committee submitted an amendment to remove it.

The amendment followed consultation from mobile payment providers which called for the tax’s removal.

The Sh3.2 trillion 2020-21 Budget contains a Sh56.6 billion post-Covid-19 economic stimulus package and an allocation of Sh128.3 billion to the Government's Big Four agenda.

The 2020 Finance Act has several amendments targeted at cushioning Kenyans from the adverse effects of the Covid-19 pandemic.

Some of the amendments in the Finance Act include the zero rating of VAT on maize, cassava and wheat flour for six months so as to make unga affordable.

The new Finance Act also extends the zero rating of VAT on cooking gas for one year.