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Zimbabwean bettors will have to pay a 10% on all sports betting wins regardless of the size
On the 28th of November 2024, Finance Minister Professor Mthuli Ncube presented his budget to the Parliament, where he announced the introduction of a 10% withholding tax on all sports betting winnings.
The new tax will apply to both land based and online sports betting sites and will take effect from the 1st of January 2025. According to Ncube, revenues from this tax will help boost the country’s economy and propel the formalization of the fast growing gambling sector.
Last year, the Zimbabwean gambling market witnessed a notable 8.5% increase, one of the highest in Africa. The Zimbabwe Mail also reported the massive increase in online platforms and betting shops around the country with many youths now turning to sports betting amidst rising unemployment rates.
Speaking on this, Ncube stated: “The popularity of sports betting has surged in recent years, becoming a lucrative industry. This 10% withholding tax ensures that the government can tap into this revenue stream for the benefit of all citizens.”
He went on to assure stakeholders that the government would specifically invest the revenues from this new tax in infrastructure development, education, and healthcare.
All punters, regardless of the size of their gross winnings will have to pay. The sports betting operators have been mandated to withhold the amount and then collectively pay it to the government.
Mixed Reactions Follow the Tax Announcement
Days after the announcement of the 10% withholding tax set to take effect at the start of the new year, opinions have emerged from various stakeholders across Zimbabwe.
Tinashe Masimba, an economist from the country’s capital city Harare, has expressed strong support for the new tax. He said: “This is a much-needed intervention in a sector that has been largely untaxed despite its massive profitability. However, the government must ensure that proper mechanisms are in place to collect this tax efficiently.”
However, operators and punters around the county don’t share his enthusiasm about the issue. Many have expressed concerns about the impact of this tax on their businesses. Speaking anonymously, one operator was quoted saying “A 10% withholding tax on winnings might discourage participation, particularly among small-scale punters. It will also require significant adjustments to our systems to comply with the new law.”
Some punters have also argued that the tax hurts them due to the risks they already face when placing bets.
Ncube closed his presentation by reminding stakeholders on the importance of responsible gambling, he said “While we aim to tax this sector for development, we must also encourage participants to gamble responsibly and avoid excessive indulgence that can lead to financial and social problems,”
Source: YogoNet
