Betting firms SportPesa and Betin have closed their operations in Kenya following the tax standoff with the government.
SportPesa had earlier expressed its disappointment with the introduction of the 20 per cent excise tax on all betting stakes.
“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,” the firm said in a statement as quoted by the Nation.
The news comes after betting giant SportPesa announced that it will resume operations as well as sports sponsorship in the country. Through their Head of Communications, Jean Kiarie, early this month, Sportpesa assured its customers of its commitment to supporting local talent.
However, the firm has decided to close business in Kenya over what they term as an unfriendly business environment, adding that the tax on stakes and 20 per cent withholding tax on winnings will affect its clients and affect returns.
“Until such time that adequate taxation and non-hostile regulatory environment is returned, the SportPesa brand will halt operations in Kenya,” SportPesa said.
Betin Kenya has also decided to shut down operations, noting that all employees will be rendered redundant on October 31, 2019.
“In view of the above, we have had financial constraints as you might all expect. As a result of the deterioration of the profitability, the management has had to rethink its operational model and to proceed with the exercise of termination on account of redundancy,” Betin said in their statement.