Kenya Moves to Tax Gambling Winnings at 20% Ahead of Public Input Deadline

Kenya’s Finance Bill 2026 has put gambling winnings under the spotlight, proposing a 20% withholding tax that would apply to both residents and non‑residents. 

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The bill, tabled in Parliament on April 30, entered public participation on May 11, with submissions closing May 25. If passed, the measure would reshape the country’s betting tax framework, which was revised only last year to focus on a 5% levy on deposits and withdrawals. 

The draft law makes clear that winnings will face a direct 20% tax under amendments to the Third Schedule of the Income Tax Act. 

Legal analysts at Cliffe Dekker Hofmeyr noted the proposal “introducing a 20 per cent withholding tax (WHT) rate on winnings” represents “a reversion to the earlier tax position” before the 2025 reforms. 

They added that the changes would extend taxation to withdrawals at 5% and winnings at 20%, while broadening the definition of deposits to include chips, tokens, credits, or similar instruments used in gambling.

Kenya is still among Africa’s largest markets

Kenya’s Finance Bill 2026 goes beyond gambling taxes, spelling out what counts as winnings and withdrawals while tightening oversight of digital payments and virtual assets. Winnings are defined as payouts from licensed betting, gaming, lottery, or prize competition operators, excluding the original stake.

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Withdrawals are described as any money or cash equivalent taken from gambling accounts. These definitions are meant to close gaps in the law and ensure that all transactions tied to betting are captured under the tax net. 

The proposals sit within a broader push to expand government revenue and strengthen regulation of digital transactions. 

Kenya remains one of Africa’s biggest betting markets, with mobile platforms like M‑Pesa fueling rapid growth in sports betting and online gaming. Reaction to the new measures has been mixed. 

Supporters argue that higher taxes and stricter oversight could boost state revenue and improve accountability. Critics warn that heavier taxation risks driving players toward offshore or unregulated sites, potentially undermining the very oversight the government is trying to enforce.

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Source: Focus Gaming News