MPs put betting firms on the spot over winnings 

By , May 1, 2025

Lawmakers have raised alarm over suspected manipulation of winnings by betting firms to evade taxes, citing a mismatch between the growth in excise duty and the decline in withholding tax (WHT) on winnings. 

National Assembly’s Finance Committee members argue that the under-collection of WHT, despite a sharp rise in excise duty revenue, is a red flag that points to potential underreporting of winnings.  

The committee has demanded tighter oversight and greater transparency from the Betting Control and Licensing Board, calling for a thorough audit of specific high-revenue games such as Aviator and Jackpot. Betting firms are obligated to pay excise duty at 15 per cent on stakes, a 30 per cent corporation tax, and a 20 per cent WHT on winnings. 

Yet, Kenya Revenue Authority (KRA) records indicate that WHT on winnings fell by 15 per cent—from Sh5.6 billion in the 2023/24 financial year to Sh4.8 billion in 2024/25—despite excise tax revenue jumping from Sh8 billion to Sh9.976 billion over the same period. 

Committee chairman and Molo MP Kuria Kimani sought to know why the taxes on excise duty would be going up, yet those on the winnings were dropping. 

He said, “If there’s more betting, there should be more winnings. This mismatch suggests possible manipulation of declared winnings by betting companies.” 

Homa Bay Town MP Peter Kaluma questioned how the betting firms managed to make huge profits, yet they had raised objections to the excise tax. 

Karachuonyo lawmaker Adipo Kuome challenged the taxman to consider societal good to just revenue collection. 

“We’ve seen young people lose everything, even committing suicide. Taxation should balance revenue generation with social protection,” he said. 

The move came after KRA revealed that WHT on winnings had dropped by 15 per cent from Sh5.6 billion in the 2023/2024 financial year to Sh4.8 billion in the 2024/2025 financial year yet the excise duty taxes increased from Sh8 billion in the 2023/2024 financial year to Sh9.976 billion in the 2024/2025 financial year. 

For instance, the report shows that in July 2024, an excise tax of Sh866 million that was earned by KRA from betting activities equated to a betting amount of Sh5.77 billion. 

On the contrary, the data by the taxman shows that in the same month, only Sh 345 million was paid as withholding tax, which was a 27 per cent drop compared to the amount paid in the year before. 

September emerged as the month that Kenyans staked the highest amount in the nine-month review period. 

This saw KRA net Sh1.326 billion in Excise duty, equivalent to Sh8.84 billion in stake. This was closely followed by December, where the taxman collected Sh1.268 billion- equivalent to a stake of Sh8.45 billion. 

KRA Chief Manager for betting and gaming, Joseph Otieno, explained that improved compliance was driven by a shift from manual to automated systems that had boosted revenue. 

He acknowledged the decline in withholding tax on winnings, attributing it to variations in betting odds, which determine payout levels. 

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