Africa-Press – Kenya. The Gambling Regulatory Authority wants to take over control of billions in revenues generated by the country’s betting industry from the Kenya Revenue Authority
This sets the stage for a shift in the collection and management of taxes and levies from gambling firms.
The authority’s director general Peter Karimi said they are exploring a framework that would allow GRA to retain or directly manage some of the revenue collected from betting and lottery operators instead of the funds being fully handled by the Kenya Revenue Authority (KRA).
Appearing before the National Assembly’s Administration and Internal Security Committee on Monday, the DG said the proposal forms part of a broader plan to strengthen oversight of the gambling sector.
This, he said, will ensure the industry becomes a larger contributor to economic development and social programmes.
Karimi, who assumed office barely two weeks ago, told lawmakers that the newly established regulator is transitioning from the former Betting Control and Licensing Board (BCLB) into a fully-fledged state corporation with expanded regulatory powers and a more complex operational mandate.
“The first thing is to protect Kenyans and give them comfort that the industry is now under extremely tight regulation,” Karimi told the committee.
He pointed out that the authority must quickly build the institutional capacity required to regulate an industry that is rapidly expanding, particularly in the online space.
The shift to a state corporation comes at a critical moment for the sector, which has witnessed explosive growth over the last decade driven by mobile betting platforms, aggressive marketing and a young digital population.
KRA data for the period to August 2025 shows a 117.2per cent growth in collection in Excise duty on betting services during the financial year 2024-2025, surpassing the set target of Sh11.288 billion.
Excise duty from betting services grew to Sh13.233 billion in the 2024-2025 financial year from Sh10.598 billion collected in the last financial year.
During the period under review, Betting Tax surpassed the set target after collecting Sh5.70 billion against a target of Sh5.495 billion. This translates to a performance rate of 103.7per cent and a growth of 22.0per cent.
However, Karimi told the committee chaired by Narok West MP Gabriel Tongoyo, that the rapid expansion has also raised concerns around consumer protection, tax compliance and potential misuse of gambling platforms for illicit financial flows.
Through the new gambling regulator the new director General said the authority intends to introduce a more robust licensing and monitoring regime ahead of a major licensing window expected to close in June 2026.
The process will require new technological systems capable of tracking both physical gambling establishments and digital betting platforms operating in Kenya.
To meet this target, the authority plans to recruit nearly 200 employees before the end of the year and invest heavily in surveillance systems that can monitor betting transactions and ensure compliance with financial reporting rules.
“Many of these operations are online and casinos unfortunately are attractive targets for illicit activities,” he said, adding that the regulator must build “top-notch surveillance” capabilities to monitor the sector effectively.
Central to the authority’s strategy is the development of a national lottery system, which Karimi said could eventually become a significant source of revenue for the government and a funding mechanism for social programmes.
He told the committee that global benchmarks show national lottery systems can generate up to two per cent of a country’s Gross Domestic Product when fully developed and properly managed.
If implemented successfully, Kenya’s national lottery could channel funding into sports development, enterprise financing and other public interest initiatives.
“We are looking at the Kenyan lottery generating revenue that can be a financial enabler for the country and support economic and social transformation,” Karimi said.
The regulator is currently exploring the appointment of a national lottery operator through a competitive process that will likely require international advisory support.
According to Karimi, the selection of a transnational adviser will be necessary to onboard a credible operator capable of managing the lottery system at scale.
The proposed reforms also include discussions within government on allowing the gambling regulator to retain a portion of the revenues it collects from licensing and regulatory fees.
The officials told the parliamentary committee that part of the revenue generated by the authority currently flows into the national fiscal framework, limiting the regulator’s ability to fund its operations independently.
Lawmakers indicated that a proposal could soon be brought before Parliament to allow the authority to retain some of the funds it collects in order to strengthen enforcement, technology deployment and licensing activities.
The move could significantly alter the financial architecture of the gambling industry, which currently sees taxes and levies collected primarily through the Kenya Revenue Authority before being allocated through the national budget.
They argued that allowing the regulator to directly control or retain some of the revenue could accelerate the rollout of new oversight systems and improve the government’s ability to monitor betting operators.
