Kenya national assembly passes new bill to regulate gambling industry

Kenya's National Assembly has approved the Gambling Control Bill, having rejected several amendments proposed by the Senate. It aims to regulate the betting and gambling industry, ensure tax compliance, and protect citizens from exploitative practices. The Gambling Control Bill is now awaiting President William Ruto's signature before it can become law. Many avid gamblers in Kenya are turning to Ke-Bet.com for its wide range of betting options and secure payment methods.

Key provisions of the Gambling Control Bill

This Bill shall intensify compliance measures and introduce new licensing conditions that will further regulate the gambling industry. The enforcement of all of these will be by the Betting Control and Licensing Board (BCLB) to ensure all gambling revenues are genuine.

The Bill also has a serious provision for security deposits that is enforceable on online gambling operators and the national lottery. Every licensed online gambling company has to deposit Ksh 200 million, the same amount needed for the national lottery operators. This is probably intended to secure online gambling, which has a wider audience than physical gambling premises.

The Bill imposes a 15 percent gaming tax on all gaming revenue, payable to the Kenya Revenue Authority by the 20th of every month. The Senate proposed an additional 15 percent tax on betting, lottery, and prize competitions, but the National Assembly rejected this.

The committee made a recommendation in its report, saying: “The House must reject the Senate Amendments to the Gambling Control Bill, having considered them”. The bill glided easily through Third Reading on Thursday and is now waiting for a signature from President Ruto to become a law.

Senate’s proposed amendments and their rejection

Initially, the Senate wanted to lower the least amount of betting stake from Ksh 20 ($0.155) to Ksh 1 ($0.0077), claiming this would mainly protect school-going children who can easily access one shilling. The amendment was rejected by MPs, who feel this would instead encourage gambling among the young.

Another major scheme from the Senate sought to reduce the required security deposit for online gambling and lottery licenses from Ksh 200 million to Ksh 20 million. The National Assembly rejected this, claiming that the higher deposit ensures serious operators are in the market while it prevents financial fraud.

The Senate proposes a 15 percent tax on gaming, lotteries, and prize competitions, but MPs argue it is not necessary since a similar tax already exists under the Tax Laws (Amendment) Act.

"The gaming tax shall be charged at the rate of fifteen per cent on the gross revenues from gaming," thus read the Senate amendment that was previously rejected by MPs. "Such tax shall be paid to the Kenya Revenue Authority by the person running a gaming business not later than the 20th day of the month next following that in which it was collected."

Majority leader Kimani Ichung'wah said a number of the amendments by the Senate had already been catered for under the Tax Laws Amendment Act. “The amendments seek to legislate on matters already addressed by the Tax Laws Amendment Act” he said during a Special Session of the House on Thursday.

Some Members of Parliament, including the Suba South MP Caroli Omondi, were arguing that the Senate amendments on the bill were a violation of Article 109 of the Constitution, which restricts the power of the Senate to introduce money bills.

While deliberating over the Senate's proposed changes to the Bill, it was observed by the committee under Dan Wanyama that some of them violated Article 109 of the Constitution, which allows for the origination of Bills. The committee highlighted that the Senate amendments had introduced a 15 percent tax on the turnover in betting, gaming, lottery, and prize competitions.

The Senate sought to have the counties have control over and oversee the licensing and regulation of gambling operations. The MPs were against it since they believed that these functions must remain at the national level to ensure uniformity.

Impact on gambling operators and the public

With the new regulations now in place, gambling companies will have to deal with higher costs due to increased security deposit requirements and stringent licensing conditions.

Foreign companies are required to pay Ksh 5.5 million (roughly $42,504) for licenses for public gaming and Ksh 6.5 million (roughly $50,232) for a public lotteries license. Another Ksh 200 million in security collateral hiked the entry barriers and made it harder for new players to come into the market.

This Bill aspires to save lives among Kenyans by curbing unethical gambling practices, ensuring responsible gaming, and preventing financial exploitation. According to this bill, raising taxes on revenues from gambling will not just increase the cost of betting; it will also put off casual gamblers and potentially send some of them to illegal betting sites.