The South African Revenues Service (SARS) is the authority that should collect the share of tax from the legal gambling entities. The operators and business have been paying their obligations, but there was not very clear what to be done with players winnings. The short answer is no, lotto, cash winnings, prizes and the sale of these type of tickets are not subject to tax in South Africa if they are conducted or authorized within the laws of South Africa. The Lotto is licensed by the government and is essentially tax free.
Gambling Winnings Tax South Africa 2019
It is very likely you as a bettor after cashing out your wins from betting sites may have thought about paying tax on the money you made especially if it is huge.
Having this kind of thought shows you are sane and have the good of your country at heart, it shows you want to remain within the ambit of the law regarding everything you do.
In South Africa where betting and gambling is gaining grounds and citizens making money off their bets, you might be wondering if the tax should be paid.
Well, the truth is bettors are not expected to pay tax on the money they made off their bets and gambling.
You may be wondering why since it is an income on the part of the bettor.
Well, in South Africa, in most cases, bet winnings, as well as gambling, lottery winnings and competition winnings, are exempted from tax.
This is because betting games are seen as a hobby or a leisure pastime, rather than a profit-making venture.
Whether you hit a jackpot or rake in a small amount in terms of winning, no tax is expected to be paid. Whatever you win is yours to keep, every dime goes into your account.
This applies to whether you bet online or do so at a casino location offline.
While bettors are not expected to pay tax, Casinos and bookmakers, on the other hand, are required to pay tax either in South Africa or in the country in which they are licensed and based.
This brings us to the conclusion that while South African players are exempted from paying any tax on their winnings, the responsibility falls instead on the casino operators themselves.
The legislation around South African internet casinos and another medium of making money online are still being debated, there are chances there could be changes in future. Bettors should make good use of the present situation.
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Gambling Winnings Tax South Africa Gauteng
Tax Victory for KenyanBetting Operators
In the latest news from Kenya's sports betting industry, Nairobi's Tax Appeals Tribunal has sided with Betin and SportPesa. This is according to reports in the 7 November edition of African news site Business Daily.
The Tribunal is said to have agreed with the operators that the new 20% Kenyan betting tax be applied only to net winnings and not, as was originally stipulated, to bettors' actual stakes.
Kenya's Changing BettingLaws
In May 2019 Kenya's newer, stricter GamblingBill wasunveiled. The aim of this piece of legislation is to protect customers, supporthealthy gambling behaviour and generate government income in the form ofgambling tax revenues. A 10% tax increase actually took effect on 1 July 2018,and the Kenya Revenue Authority (or KRA) has been after local operators to payup since then.
The KRA's initial amended definitionof winnings was that it was all monies paid to winning bettors, including thereturn of the original stake. Until all outstanding taxes were paid, thecountry's 29 legal bookmakers were suspended by the Betting Control andLicensing Board, or BCLB. This took effect on 1 July 2019.
Companies disagreed with the original amended definition, although SportPesa and Betin did ultimately comply in order to be allowed to resume local operations. Before settling their 'outstanding debts' they had been forced to lay off hundreds of members of staff and to suspend their business dealings in Kenya.
Then on 19 September 2019 the KenyanParliament's Finance Committee proposed the 20% excise rate for the 2019/2020budget. The proposal was voted through almost a week later, on 25 September.This is what SportPesa and Betin appealed against with the Tribunal.
The Tribunal is said to have agreed with the operators that the new 20% Kenyan betting tax be applied only to net winnings and not, as was originally stipulated, to bettors' actual stakes.
Kenya's Changing BettingLaws
In May 2019 Kenya's newer, stricter GamblingBill wasunveiled. The aim of this piece of legislation is to protect customers, supporthealthy gambling behaviour and generate government income in the form ofgambling tax revenues. A 10% tax increase actually took effect on 1 July 2018,and the Kenya Revenue Authority (or KRA) has been after local operators to payup since then.
The KRA's initial amended definitionof winnings was that it was all monies paid to winning bettors, including thereturn of the original stake. Until all outstanding taxes were paid, thecountry's 29 legal bookmakers were suspended by the Betting Control andLicensing Board, or BCLB. This took effect on 1 July 2019.
Companies disagreed with the original amended definition, although SportPesa and Betin did ultimately comply in order to be allowed to resume local operations. Before settling their 'outstanding debts' they had been forced to lay off hundreds of members of staff and to suspend their business dealings in Kenya.
Then on 19 September 2019 the KenyanParliament's Finance Committee proposed the 20% excise rate for the 2019/2020budget. The proposal was voted through almost a week later, on 25 September.This is what SportPesa and Betin appealed against with the Tribunal.
The Tribunal's Ruling
In addition to saying that the 20%tax applies to net winnings only, the Tax Appeals Tribunal has also ruled thatindividual bettors must take more responsibility for tax remittance. The onusno longer falls on the operators to the same degree. Insiders explain that theTribunal's intention is to shield sportsbooks from prosecution by what is nowconsidered a very aggressive government administration.
The Future Remains Unclear
Although SportPesa and Betin wereable to resume their Kenyan activities after settling debts, while the issuesthat the Tribunal ruled on were still unresolved they could not operator atfull capacity. Now, in the wake of the Tribunal's findings, the BCLB has saidthat any suspended businesses will need to apply for brand new licences.
As the betting industry in Kenya and aroundAfrica continues to mushroom, bolstered by the mobile technologyrevolution, authorities continue to seek gambling tax revenue as a way tobolster their coffers. In the past week, the KRA set its sights on Betika andsought Sh1.75 billion (or $17 million) in outstanding taxes.
Since Betika was among the few BCLB-licensed firms that imposed KRA's original tax amendments, the fact that the KRA has now gone after them could be perceived as very mercenary. Of course, if the monies gained from revenues really do benefit ordinary Kenyan citizens, there will be few criticisms leveled at the government for imposing the taxes. Whether that will indeed be the case remains to be seen.
