The Kenya Revenue Authority (KRA) has issued Kenya’s biggest betting firm Sportpesa a Sh14.9 billion tax bill.
According to KRA, Pevans East Africa, the company behind Sportpesa, has failed to withhold and remit taxes from winning bets. This they say is in accordance with the Income Tax Act that requires all winnings be taxed.
The taxman claims that Sportpesa has paid out Sh60 billion to winners, but has failed to withhold and remit Sh12 billion, being 20% of the winnings. That amount has shot up to Sh14 billion after interest and penalties.
Sportpesa has however gone on the defensive, saying that there exists a court order barring KRA from collecting the tax. The court order was issued in 2014, barring both KRA and Sportpesa from taxing winnings, and the Everton FC sponsor is accusing KRA of contempt. They are further accusing the taxman of threats and intimidation.
KRA has given Sportpesa a 14-day ultimatum to respond or pay.