Time flies with great content! Renew in to keep enjoying all our premium content.
Prime
Gamblers beat NSE with Sh330bn stakes in one year
Under the current tax laws, punters are charged a five percent excise duty on all funds deposited into their betting wallet hosted by mobile money platforms like M-Pesa or Airtel Money.
Gamblers placed bets worth a record Sh330.5 billion in the year to June as the State eased punitive taxes on the sector, which outpaced new investments at the Nairobi Securities Exchange (NSE).
Data from the Kenya Revenue Authority (KRA) shows the boom in online gambling, with the taxman netted Sh16.5 billion in excise taxes from the industry, surpassing its target by 15.9 percent.
This emerged in a period when Kenya lowered excise duty to five percent from 15 percent, offering relief to gamblers.
The KRA says the five percent generated Sh16.5 billion, indicating that gamblers staked Sh330.5 billion, riding a wave of enthusiasm for sports, up from Sh88.2 billion the previous year.
At Sh330.5 billion, the bets surpassed the Sh145 billion that retail, foreign and high-net worth investors splashed in purchase of shares at the Nairobi bourse, which posted a return of 52 percent.
It nearly matched the Sh367 billion that investors used to purchase units in money market funds amid a boom in Kenya’s unit trust market.
The cut in the excise rate likely encouraged more gambling activities as the taxman rejected a push to encourage betting, linking the rise in collections to improved tax administration.
“This reflects tax administration in a regulated sector,” the KRA said last week.
“KRA administers tax laws and collects legally due revenue from regulated activities. Betting-related tax performance reflects tax administration in a regulated sector, not the promotion of betting.”
The taxman says that 143 betting and gaming companies were integrated for real-time access as of June 2026, as it strengthened the collection at the point where the taxable transactions occur through system integration.
“The integration of the Integrated Financial Management Information System with iTax has improved visibility over government procurement, while betting and gaming integration supported real-time sector visibility,” the KRA added.
Under the current tax laws, punters are charged a five percent excise duty on all funds deposited into their betting wallet hosted by mobile money platforms like M-Pesa or Airtel Money.
Additionally, there is a five percent withholding tax deducted when the gamblers withdraw money from the betting account.
This means if gamblers place Sh1,000 in their wallets, the KRA takes Sh50 as excise tax before placement of bets and Sh50 is deducted when withdrawing, regardless of wins or losses.
As a boom in online gambling across Africa gathers pace, governments are hiking taxes to contain addiction risks and fill depleted state coffers.
But Kenya pushed back from the higher taxes in the year starting July 2025.
Betting firms across Africa have lobbied hard against higher taxes, arguing that the tax would not curb problem gambling but instead push it to underground sites, which they say would proliferate without the extra burden of the levies.
Once a niche activity, gambling has exploded across the continent as a result of easily available online betting accounts.
The outsized stakes underline Kenya’s ranking as Africa’s top betting market. A GeoPoll survey published last month revealed that 64 percent of respondents in the country had placed a bet on at least one football game in the past 12 months.
Kenyans outpaced other African peers with the high level of sports betting engagement over the period, beating Ghanaians and South Africans, who ranked second and third with engagement levels of 60 percent and 58 percent, respectively.
GeoPoll noted that betting activities usually rise during major tournaments like the ongoing FIFA World Cup, 2026 hosted by Mexico, the USA and Canada, which featured an expanded 48-team format, handing punters more games to choose from.
The data further showed that Kenyans were not only betting more often but also engaging more intensely with football.
The findings showed that 67 percent of respondents in Kenya watched three or four football matches per week, making Kenya the highest viewer segment among surveyed markets, which included Nigeria, Uganda, Cameroon and Egypt.
The survey further revealed that Kenyan punters also lead the way in tinkering with their bets during the 15-minute halftime break, including placing of more wagers.
Members of Parliament (MPs) cut excise duty on betting in June last year, increasing potential winnings for punters.
The Chairperson of the National Assembly Finance and National Planning Committee, Kuria Kimani, did not provide the reasons for slashing the rate of excise taxes when contacted by this publication last year.
Mr Kimani, however, noted that the change to obligate mobile money operators to remit the excise charge before funds are sent to betting wallets sought to close a loophole where Kenyans were placing wagers on foreign-based betting platforms without paying excise taxes.
“There are so many entities operating virtually, some outside the country, from which we cannot get this excise duty from them. This now means that every time a Kenyan transfers money from their mobile wallet to the wallet of the betting company, then that’s the time the excise duty is paid,” he said.
Betting firms are required to compute all excise taxes after midnight every day and remit the same to the KRA the following day by seven o’clock in the morning.
The previous increase in the excise duty levied on betting activities was premised on the need to cut the appeal of betting in the country, which has turned to addiction for millions of Kenyans who see it as a source of their livelihood.
The amount wagered would be enough to fund any one of the key government ministries like Roads, Housing or Health.
The government, however, appears to be turning other screws to moderate gambling activities as public health advocates increasingly raise concerns about the rapid expansion, warning that aggressive marketing and easy digital access could be accelerating the problem, particularly among young users.
The Gambling Control (Advertising) Regulations, 2026 seek to bar betting firms from using influential personalities and past winners of large prize money to promote their services.
Further regulations seek to revoke the licences of betting firms that entice addicted punters who have sought to be barred from gambling. The Gambling Control (Conduct of Gambling Operations) Regulations, 2026 require betting firms to establish automated systems that reject deposits made by self-excluded punters throughout the exclusion period.
Betting firms in Kenya will also be obligated to freeze the accounts of gamblers who are in financial distress under the proposals that also allow families to request the gaming regulator to ban their kin from gambling.
