The future holds “severe consequences” for Kenya’s sporting director and betting revenue following the announcement that both SportPesa 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 per cent tax increase on game, betting and lottery winnings.
In a statement which has been released by SportsPesa, it 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.”
However despite this, the sports betting operator has announced plans to return to Kenya, but this time with a focus on its lucrative gaming market. Its return to Africa will depend on whether or not the government reconsiders and implementers “adequate taxation and a non-hostile regulatory environment.”
Betin, who joins SportPesa after its exit from the Kenyan market, has gone on to terminate all of its employees and cites redundancy, frustration, heavy taxation along with the government’s failure to renew its operating license as the reasons behind the decision.
After failing to comer 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.”
After now looking set to face a decrease in revenue, Kenya 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.