”The Country Is Poor” – Gov’t Slaps 30% New Tax On Betting Companies

”The Country Is Poor” – Gov’t Slaps 30% New Tax On Betting Companies

By Spy Uganda

Parliament has passed the Lotteries and Gaming (Amendment) Bill, 2023 that will revise the existing tax of 20 per cent under the existing law to 30 per cent for a gaming activity.

Clause 48(1) of the Lotteries and Gaming Act, 2016 states that ‘an operator of a casino, gaming or betting activity issued with a licence under this Act shall, in addition to taxes prescribed by law, pay a gaming tax at the rate prescribed in Schedule 4’.

Schedule 4 of the existing law prescribes the rate of tax as 20 per cent of the total amount of money staked, less the pay outs/winnings, for the period of filing returns.

While presenting a report on the Bill during on Thursday, 04 May 2023, the Deputy Chairperson of the Finance Committee, Hon. Jane Pacutho said the 20 per cent tax rate will be maintained on sports betting.

She added that there are multiple start and stop points within some games which make it hard to enforce the tax point for winnings, including punter sessions for games like roulettes, poker and slots.

“Consequently, casinos are instead using the end of day reconciliations to account for withholding tax which would only be on the days when they have made losses. Such an occurrence is highly unlikely for a casino because betting/gaming companies are always winning,” reads the committee report in part.

The committee emphasized the need to adjust the current policy and ensure the tax is only imposed on winnings and not the staked amounts.

“To plug this revenue leakage, the measure proposes to remove the 15 per cent withholding tax on payments for winnings of gaming and instead increase the gaming tax to a rate of 30 per cent across the gaming sector,” Pacutho said.

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