Betting firm, SportPesa, has sent home at least 400 employees days after it announced the closure of its business in the country.
Ronald Karuri, the firm CEO, on Wednesday, stated that their services were no longer tenable following harsh government regulations.
Karuri announced last week that SportPesa won’t resume its services until the government scraps the 20% exercise tax imposed on all stakes.
The firm further argued that the imposed tax could have dire consequences on betting firms which are tax compliant.
“Sportpesa is disappointed with the decision by the Kenyan legislature to impose a 20% 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.
Read: Betting Firms Sportpesa, Betin Halt Operations Over Harsh Regulations
Until such time that adequate taxation and non-hostile regulatory environment is returned, the SportPesa brand will halt operations in Kenya,” the firm said in a statement.
At the same time, rival company Betin also announced that the prolonged tax standoff with the government had informed the decision by the management to issue a notice of termination to all its employees.
“…As a result of the deterioration of the profitability, the management has had to rethink its operations model and proceed with the exercise of termination on account of redundancy,” a memo addressed to all staff read in part.
The two firms are among over 27 gambling companies that didn’t have their licence renewed by the Betting and Betting Control And Licencing Board (BCLB) over nontax compliance.
Read Also: SportPesa, Betin Sue KRA For Demanding Ksh14 Billion In Tax Arrears
Those that have so far been cleared by the Kenya Revenue Authority for licensing by Betting and Licensing Control Board are; Betway, OdiBets, Mozzartbet, Ken Bookmakers, Lucky 2u, Eazi Bet, Kick off, Eastleighbet, Palms Bet and Bet boss.
Interior CS Fred Matiang’i in April gave all firms three months up to July 1 to seek fresh renewal of licenses upon proving tax compliance.
The CS maintained that the government will put in place strict regulations to curb gambling in the country adding that no country had developed through the addictive activity.
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