Sportppesa has put to a halt its operation in Kenya after long months of protracted legal battle with the government over tax regulations.
The decision by SportPesa came along with the cited hostile regulations by the government of Kenya, following a requirement by Treasury that all winnings on a bet should be imposed a 20% excise tax.
“The tax is based on a fundamental misunderstanding by the Rotich led Treasury of how revenue generation works in the bookmaker industry. This decision will have a damaging impact on both customers and treasury” stated SportPesa in a statement.
SpotPesa which was the largest betting firm in Kenya will see an unknown number of staff lose their income due to the decision.
“Until such a time that adequate taxation and non-hostile regulatory environment is returned, the SportPesa brand will halt operation in Kenya.”
On July 10, the government issued a directive to telcos with mobile money services to withdraw paybill numbers of betting companies.
According to the government, betting firms had failed to prove they were tax compliant as required by the Betting Control and Licencing Board (BCLB). The probe by the multi-agency team found that the betting companies made Ksh204 billion last year but only paid Ksh4 billion in taxes.
The move by SportPesa happens in the wake of hard economic times in the country, where tens of companies have laid off workers. Economic analysts have attributed this to the ongoing demonetisation in the country, with the looming deadline by Central Bank of Kenya (CBK) scheduled for October 1.
