SportsPesa and Betin cease Kenyan operations following tax increase
“Severe consequences” are on the horizon for Kenya’s sporting sector and betting revenue following the announcement that both SportsPesa and Betin will cease operations within the country.
The move follows on from a lengthy standoff with the Kenyan government regarding a change to a legal bill which saw a 20% tax increase on game, betting, and lottery winnings.
SportsPesa released a statement which read: “This will have severe consequences for licensed betting companies, which dutifully pay their taxes and ultimately will lead to a decline in government tax revenue to near zero and will halt all investments in sports in kenya.”
Despite this, the sports betting operator has plans to return to Kenya, this time with a focus on its lucrative gaming market. Its return to African country will, however, depend on whether or not the government reconsiders and implements “adequate taxation and a non-hostile regulatory environment.”
Betin, who joins SportsPesa in its exit from the Kenyan market, has terminated all of its employees and cites redundancy, frustration, heavy taxation as well as the government’s failure to renew its operating license as the reasons behind the decision.
Having failed to come to an agreement with the Kenyan government, Betin released a memo which stated: “As a result of the deterioration of the profitability, the management has had to rethink its operating model and to proceed with the exercise of termination on account of redundancy.”
Kenya, who now look set to face a decrease in revenue, has been one of the quickest growing markets for gambling in recent years and currently sees its gaming industry generate up to an equivalent of $2 billion.
Source: SBC News