Taxman takes betting tax case back to court
Kenya Revenue Authority (KRA) has filed a notice of appeal seeking to challenge the judgment of the Tax Appeals Tribunal (TAT) delivered on November 6, this year in favour of betting firms.
KRA’s move comes days after betting firms celebrated the tribunal decision saying KRA had departed from a decision rendered by Justice Hatari Waweru of the Meru High Court.
The judge found no ambiguity in the interpretation of the term “winnings” as defined by the Income Tax Act, a fact which the appeal tribunal found inapplicable hence not binding because it had not delved into the definition of the term.
Seven betting firms filed the appeal before the Appeals Tribunal challenging KRA’s interpretation of “winnings” as amended by the Finance Act 2018.
“KRA commenced the process by filing a notice of appeal on November 8, 2019,” said Paul Matuku, commissioner for legal services and board coordination.
The decision to shut down betting firms over the withholding tax on winnings had been proved premature and costly after the Tax Appeals Tribunal ruled in favour of betting firms .
The Tribunal ruled that the 20 per cent tax charge should only be applied to winnings interpreted as the amount of money paid out to a customer excluding the stake.