Taxation on gambling winnings across Africa has faced recurrent challenges since its introduction. Initially aimed at generating revenue and reducing gambling-related harm, these measures have often run into problems with enforcement, resistance from the gambling industry, and the worrying trend of players shifting to untaxed or offshore gambling options. As a result, many governments have found themselves repealing, narrowing, or restructuring these taxes when the anticipated financial benefits failed to materialize.
In a notable move, Ghana has abandoned its recently implemented tax on gambling winnings. The Income Tax (Amendment) Act 2023 had introduced a 10% withholding tax on betting and lottery winnings, along with a 20% tax on the gross gaming revenue (GGR) for operators. However, less than two years after its introduction, the Ghanaian parliament repealed this 10% tax with urgency, formally enacting the change with President John Dramani Mahama’s approval on April 2, 2025.
Cassiel Ato Forson, the finance minister-designate, argued for the tax’s elimination during a January 2025 committee meeting and reiterated this stance in his first budget address. The Ghana Revenue Authority initially expected to collect around GH¢268.75 million (approximately $23.3 million) from this tax package, but actual receipts plummeted to around GH¢80 million before its repeal, resulting in a 70% shortfall.
Government spokesperson Felix Kwakye Ofosu characterized the tax as an undue burden on low-income gamblers, highlighting that taxing small wins during economic hardship only exacerbated their struggles. He questioned the government's decision to impose such a tax on those already facing employment challenges.
In Uganda, the situation is evolving differently. Beginning on July 1, 2026, new amendments have reinstated a 15% withholding tax on net winnings, which are defined as payouts minus stakes, alongside a simplified 30% tax on gross gambling revenue. To improve compliance, lawmakers required operators to settle tax arrears by June 30 to avoid penalties—a move met with skepticism from business owners who argue that real-time collection is practically impossible in land-based casinos, as outlined by Bob Kabonero of the Uganda Gaming Operators Association. He pointed out the complexities involved in tracing transactions when multiple players are engaged simultaneously at cash tables.
Zimbabwe, however, has taken a more aggressive approach, raising its withholding tax on winnings from 10% to 25% starting January 1, 2026. This change is coupled with a hike in the bookmakers’ tax from 3% to 20%. While the government originally anticipated collecting about $15 million annually from the prior tax, the sharp increase to 25% has prompted concerns from industry stakeholders regarding its impact on operators and players. The Portfolio Committee on Budget, Finance and Investment Promotion has warned that such high taxation could drive activity underground, adversely affecting revenue in the long run.
The Confederation of Zimbabwe Retailers has also criticized these taxes as being regressive, stressing that they primarily burden low-income individuals. As proposed, these taxes are framed as essential for enhancing revenue, yet experts caution that they may deter participation in the regulated market.
In Kenya, a cycle of taxes on winnings has shown the fragility of such measures. Following the retraction of a previous 20% tax on winnings between 2018-2020, the Finance Act 2025 replaced individual winnings taxation with targeted levies of 5% on deposits and withdrawals to betting wallets. Notably, the Finance Act 2026 has recently narrowed its focus back to a 20% tax on winnings only from lotteries and prize competitions, moving away from general betting and gaming, a shift framed by Finance Committee chair Kimani Ichung’wah as a necessity to bring high-value lotteries into the tax system.
In Lagos, Nigeria, a more measured approach has been adopted with a 5% withholding tax on net winnings introduced in February 2026. This strategy mandates that operators deduct the tax at payout while linking it with the bettor’s National Identification Number for smoother income tax integration. For most players, the relatively low rate may be absorbed as part of the overall costs of engaging with licensed services, as the city tests whether such a modest tax combined with robust KYC measures can manage to increase revenue without driving users to unlicensed platforms.
Conversely, South Africa is reconsidering its taxation approach. Rather than taxing player winnings, the National Treasury is advocating for a 20% tax on gross gaming revenue from online operators, augmented by existing provincial taxes. This shift aims to account for social issues associated with the growth of online gambling and to raise approximately R10 billion yearly.
Taking all these developments into account, it becomes clear that taxation on gambling winnings in Africa remains tenuous. Governments have been experimenting with such taxes for over a decade, often struggling to balance revenue goals, compliance, and the risk of operators and gamblers gravitating toward lower-tax or unregulated alternatives. In Ghana, the winners’ tax was eliminated after failing to generate expected revenue, while Zimbabwe’s punitive 25% tax may challenge overall market participation. Conversely, Kenya's tax strategy has shifted to focus on deposits and withdrawals in hopes of better revenue stability.
Thus, as jurisdictions grapple with these issues from Uganda to Nairobi, the broader lesson remains: while governments aim to capitalize on gambling revenue, the sustainability of these taxes, particularly when set at levels impacting payouts significantly, faces significant scrutiny and resistance.
