The sudden cessation of businesses in Kenya has been verified by one of the most prominent gambling organisations in Kenya, although the reasons behind the decision have not been disclosed.
The Betsson brand Betsafe, which began business in Kenya in 2020 and struck large endorsement sponsorship agreements with two of the most prominent football clubs in Kenya, Gor Mahia and AFC Leopards, issued the following statement in a press release: “We regret to inform you that Betsafe Kenya will cease its operations effective May 14, 2024.” The outstanding player balances will be refunded to the registered number via M-Pesa within a period of seven days.
Several days following the legislature suggested raising the excise tax on betting stakes from 12.5% to 20%, which would be extremely detrimental to gamblers if it were to be implemented, they decided to leave the company.
In the event that the new amendment is approved, gamblers will be required to pay KSh 20 for every KSh 100 that they wager, which is an increase from the existing KSh 12.5.
A portion of the legislation provides that “We modify the inaugural schedule within the Excise Duty Act by eliminating the words 12.5 percent and replacement therewith with the phrases 20%.”
A smaller sum will be wagered by gamblers, which will result in a lower possible payoff in the event that they are successful. According to the law, betting companies are required to deduct and send withholding tax to the Kenya Revenue Authority (KRA) by the 20th of the following month.
Companies will also be required to pay taxes equal to 15% of their total gaming revenue to the KRA, in addition to a 1% monthly income levy.
The betting company Betsafe has left the Kenyan market as a result of the ongoing trend of rising taxes, which is driving businesses out of the industry that is worth multiple billions of dollars.
The chief executive officer of Betsafe, Victor Sudi, announced that the company had been forced to discontinue operations in the Kenyan market, so rendering its 1000 employees jobless.
This company is the most recent to withdraw from the market, claiming what it refers to as high taxation. Prior to this, other firms, including Betin, Betway have been forced to close their doors due to the same issue.
Additionally, betting companies are required to contribute a corporate tax of thirty per cent on their profits, and they are also liable to a tax of fifteen percent on their gross wagering revenue.
The businesses are additionally liable to pay annual licencing and compliance costs, in alongside paying income tax at a rate of sixteen percent that is applicable to them.
A proposition was presented to the Parliament in the previous year that would mandate that gambling operators pay a gaming fee that is equivalent to thirteen percent of their total gaming revenue.
According to Mr. Sudi, “It is true that Betsafe Kenya will cease its operations throughout the country with effect from May 14, 2024.”
By way of Bet High Kenya, the Kenyan affiliate of Betsson, Betsafe opened its doors for business in Kenya in the month of December and 2020.
However, Mr. Sudi did not disclose the approximate number of Kenyans who lost their employment as a direct result of Betsafe’s departure; however, he did guarantee that clients who had balances remaining would have their money back within a week.
