Betin is one of the gambling firms which the Government has not renewed
theie licences because they failed to follow the licencing guidelines.
FILE PHOTO | NMG
The Kenya Revenue Authority (KRA) is demanding Sh61 billion from
betting companies amid protest by MPs that the State defied courts in
denying the gambling firms licences.
The KRA said it
submitted the list of 72 non-compliant betting, lotteries and gaming
firms to the Betting Control and Licensing Board (BCLB) when the
regulator demanded to know the tax compliance status of the companies.
Seven
out of 72 registered betting firms have signed payment plans with the
KRA while 27 have compliance issues, the Senate heard Wednesday.
The
Senate Committee on Justice, Legal and Human Rights summoned the BCLB
and Interior Secretary Fred Matiang’i for acting against court orders.
The
committee chaired by Samson Cheragei (Nandi) said it reeks of impunity
for the regulator to suspend operations of the companies as well as to
deport some of their directors when the matter was pending before the
High Court.
The committee has summoned Dr Matiang’i and the regulator to appear before it this morning.
“We
want them to tell us why they have decided to treat court orders as
tissue paper,” said Mr Cheragei, adding the committee will investigate
defiance of court orders in betting licence row.
Betting
firms, including SportPesa, Betin Kenya and Bet Pawa, had court orders
stopping the withdrawal of their permits following the tax rows.
The
State through the BCLB ordered Safaricom on July 10 to suspend M-Pesa
payment systems and SMS codes for 27 betting firms including SportPesa
and Betin because their operating licences for the year starting July 1
were not renewed.
KRA deputy commissioner Elizabeth
Meyo told Senators that the dispute with betting firms arose after the
enactment of the new law that changed the definition of bet winnings,
placing new demands on betting firms that are expected to withhold 20
percent of the winnings.
Previously,
the betting firms were expected to withhold 20 percent of the positive
difference between winnings and the amount staked. But the current law
demands the firms withhold 20 percent of the winnings irrespective of
whether the bets surpass the winnings.
SportsPesa chief
executive Ronal Karauri told the committee the court allowed them to
operate pending the conclusion of the tax dispute.
Mr
Karauri said the court ordered that no action should be taken against
the betting firms pending the conclusion of the court case but the KRA
and BCLB disregarded the same.
“SportsPesa has
transitioned from small domestic taxpayer to a large domestic taxpayer
having paid combined Sh17 billion in taxes,” he said.
The KRA is demanding Sh21 billion from SportPesa.
“This
definition removed provision for deduction of amounts staked. One of
the key mandates of KRA is to collect tax revenue. We don’t issue
licences,” Ms Meyo said.
Besides the permit freeze,
deported 17 foreign directors of the betting firms including nationals
of Bulgaria, Italy, Russia and Poland following the licensing row.
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