Betpawa, Betways anti-tax bid flops
By George Zulu
THE Constitutional Court has dismissed an application by Betbio Zambia Limited trading as BetPawa and Emerald Bay Limited trading as Betway seeking to restrain the Zambia Revenue Authority (ZRA) from imposing and collecting a newly introduced 10 per cent excise duty on betting stakes.
The two betting companies had sued ZRA and the government through the Attorney General.
They had petitioned the court, arguing that Section 7 of the Customs and Excise (Amendment) Act No. 11 of 2025, which introduced the excise duty on betting services was unconstitutional.
The two companies cited violations of Articles 8, 9, 10, 89, and 198 of the Constitution of Zambia, alleging lack of transparency, inadequate public consultation and severe economic impact.
The petitioners claimed the tax was excessive, ambiguous, unimplementable and financially unsustainable.
They also argued that the tax, if implemented, would force them to shut down operations and lead to widespread job losses.
In response, ZRA maintained that the excise duty was a consumption tax borne by betting players, not operators, and that the law was enacted following stakeholder engagement.
It argued that the petitioners’ financial projections were speculative and unsupported by audited data.
The two betting companies sought an interim injunction to stop enforcement of the excise duty pending the full hearing of their constitutional petition.
They argued that the tax burden exceeded their gross gaming revenue, that the law lacked clarity on its application, and that the timing of its introduction mid-financial year made compliance practically impossible.
They contended that damages would not be an adequate remedy given the scale of potential harm.
However, ZRA countered that the tax was lawful and implementable in its current form.
ZRA, through its company secretary, argued that halting the tax collection would unjustifiably interfere with its statutory duty, which flows directly from the Constitution and reflects one of the core attributes of state sovereignty.
It submitted that granting an injunction would undermine the widely accepted “pay now, argue later” principle, a cornerstone of tax administration in most jurisdictions.
Justice Judy Zulu Mulongoti ruled that the petitioners had failed to demonstrate a sufficiently serious constitutional issue to justify suspending the law at this stage.
Justice Mulongoti held that granting the injunction would effectively halt the operation of a law passed by Parliament, which is not permissible at the interlocutory stage.
The court emphasised that ZRA had a statutory duty to collect taxes on behalf of government and that duty was rooted in public interest which outweighed the private interest of the two betting companies.
The court held that restraining ZRA would be unjustified because its statutory duty to collect taxes served a critical public function, and granting the injunction would elevate the private interests of the two betting companies over the public interest in revenue collection without any serious constitutional question or proof of irreparable harm.
Justice Mulongoti dismissed the application for interim injunction, allowing ZRA to continue collecting the excise duty.
The constitutional challenge case will proceed to full hearing while the dismissal of the application of the betting services remains in effect.
