Gaming in Kenya is large and still growing despite the global pandemic and it’s fueled by the country’s passion for sports and a surge in youth’s interest in betting. Sportsbook is among the most popular pastimes enjoyed by Kenyans who like gaming, followed by online play and casino games. While casinos and sports betting seem to keep gaining momentum in Kenya, the attitude towards gaming seems discordant.
Some see young peoples’ enthusiasm for gambling as a societal ill, while some praise the revenue taxation from the operators and player winnings. At the same time, H.E. President Uhuru Kenyatta has wavered on promises regarding taxes on the betting market, and changing tax rates has kept some operators from expanding within Kenya. The next few years will be crucial in setting the tone for the gaming market in the country, on the part of both the government and companies running land and online casino operations.
Back and Forth
Serving as the third-largest gaming market south of the Sahara, Kenya oversees its industry with the help of its Betting Control and Licensing Board (BCLB). They help regulate following the Betting, Lotteries, and Gaming Act of 1966, which legalized gambling in the country. Something the Act did not address originally, of course, is the biggest market advantage for Kenyan casino operators today: the Internet.
Kenya has one of the highest rates of growing Internet penetration in recent years. It follows that the casino industry is using that technological edge to reach more players than ever. This makes sense, considering the majority of Kenya’s bettor base are young gamblers who are living in a more mobile, modern world. In 2019, 88% of bettors in Kenya used their mobile devices to place sportsbook bets, and with the popularity of mobile payment companies like M-Pesa growing this percentage will most likely go up.
Mobile penetration and a lack of online regulation allow gamers to place wagers or play games with whatever provider is online. There are off-shore casinos that operate with licenses, like Betsafe in Kenya, but unregistered sites are also accessible within the country and there are generally no repercussions for foreign operators or for players who choose to frequent them. A bill was introduced to more strictly regulate online gaming in 2019 but hasn’t seen much progress since its first reading.
Betsafe operates in Kenya, sponsoring Gor Mahia and AFC Leopards
Take a Tax Hike
Historically, Kenya has expected its gaming industry to contribute in the form of gambling revenue tax, perhaps as a way of balancing out the complaints that casinos are creating a larger societal problem and fueling a gambling addiction in its youth population.
In 2018, President Uhuru Kenyatta decided to implement a 15% gaming income revenue tax 15% and a 20% tax on sportsbook stakes and punter’s winnings. The change was considered controversial by many operators and some threatened to leave the market altogether.
Sportpesa is one big-name Kenyan sports betting brand that has been absent for a year after a legal dispute with the Kenyan government over the tax change but has recently announced it will be returning under a new partnership with Milestone Games.
In June last year, the National Assembly approved the 2020 Finance Bill, which removed the sports betting tax. However, President Kenyatta says that the removal was only temporary. Within the next six months, operators and bettors will see the tax reintroduced in a different form. Much of the Finance Bill focuses on recouping lost revenue and buffering taxpayers during the pandemic.
Further changes to the Gambling Act are also in the works, with amendments intended to curb problem gambling planned. In the past, recommendations have been to replace Kenya’s sports betting industry with a national lottery in an attempt to help stem the rising gambling addiction in the country.
Until today, there has been no confirmation on whether or not the government intends to follow up on those suggestions. A full ban on betting would drastically change the market for existing operators and those attempting to return.