Gamblers will no longer have to part with some of their winnings in the form of withholding tax after MPs approved a change to the law on income tax. The provision had been taken away for non-residents last year but it proved difficult to implement for locals, forcing Treasury Cabinet Secretary Henry Rotich to ask MPs to drop it.
“After consultations with the National Treasury and the Kenya Revenue Authority, it came out that it is not possible to withhold those winnings because you need the pin numbers of the people who are betting and winning, and also the i-tax requirements. For administration purposes, this clause cannot be implemented,” said Finance Committee Chairman Benjamin Lang’at.
It was one of the changes to the taxation regime done by MPs as they approved the Finance Bill last week. MPs also approved a proposal by Treasury to drop excise duty on motorcycles and for parts used for their local assembly.
Mr Lang’at said the idea was to encourage local investments and to make motorcycles more affordable. In the Excise Duty Act passed last year, tax on motorcycles had been set at Ksh10,000 each.
This would result in an increase in their price and the removal by the National Assembly should result in their cost reduction. “In the law that we passed a few months ago, there was a problem in the formula that we created for inflation adjustment. We are now correcting that error,” Mr Lang’at said.
Excise duty on vehicles was also returned to 20 per cent of their cost rather than the Ksh200,000 for vehicles older than three years and Ksh150,000 for those below three years old that had been set in the Act.