KRA seeks 35pc tax on ads placed by betting firms

The Treasury and the Kenya Revenue Authority (KRA) want a 35 percent tax imposed on all advertisements booked by betting firms through radio, television, online, billboards, short messaging service and any other medium.

Mr Caxton Masudi, the KRA deputy commissioner in charge of policy told Parliament that the base of taxation should be pegged on the cost of the advertisement.

Appearing before the National Assembly’s Sport and Tourism committee to present KRA’s views of the Gamming Bill, 2019, Mr Masudi proposed that it be amended to cover all media.

“There shall be a tax to be known as the gaming advertisement tax chargeable at the rate of 35 percent on the cost of the gamming advertisement done through radio, television, newspapers, short message service and any other advertisement medium,” KRA proposed.

Treasury Chief Administrative Secretary Nelson Gachuhie asked MPs to make it a criminal offence for betting firms that fail to disclose or provide data on betting revenues to the KRA.

The recommendations follows similar proposals by the Betting Control and Licensing Board (BCLB) which called for restricted advertisement on betting.

“We have seen an influx of media outlets advertisements which are tailored to lure Kenyans into engaging in gambling,” Mr Peter Mbugi, the BCLB director-general told the committee.

The committee, chaired by Machakos Town MP Victor Munyaka is conducting public hearings to collect views from Kenyans on the gamming bill.

The Bill also requires all gamming advertisement to indicate the addictive nature of gambling, urge players to play responsibly, prohibit a child from playing and not feature a former winner with a view to encouraging the general public to bet, play or participate.

The proposed law also prohibits all media companies holding licences on gamming from using any of their broadcast frequencies to advertise or promote their gamming products or activities.

Those who contravene the requirement on advertisement risk a fine not exceeding Sh20 million or imprisonment for a term not more than five years or both upon conviction.

The BLCB also told MPs of radio stations that ask listeners simple questions on the promise of rewarding them with money, only for them to collect lesser amounts.

Mr Mbugi said research had shown that some of the winners announced in radio and others paraded on Television as winners had not actually won.

Communications Authority of Kenya acting director in charge of licensing, compliance and standards Christopher Kemei said: “This is a con game. This is an area that needs to be looked into and we will work with other actors to address the same,” he said.