Sportspesa Kenya to Withdraw Sponsorships Effective January 1, 2018

President Uhuru Kenyatta on Wednesday passed the Betting, Lotteries and Gaming Amendment act, requiring all gaming companies to render 35% of their gross earnings to government as corporate tax. SportPesa CEO Ronald Karauri says that the company will now not be able to sustain its sponsorship activities.

“It will be impossible to continue funding the sector with the taxes that have been imposed. We shall therefore be giving notice to all the beneficiaries of our sponsorships to inform them that we shall not be able to sustain those activities going forward,” Karauri, who is also the Chairman of the Association of Gaming Operators Kenya – told a media briefing.

Those to be cut off the sponsorships include the Football Kenya Federation, the Sportspesa Premier League, Boxing Association and the Kenya Rugby Union. The Hull City sponsorship will however not be affected as it is in partnership with Sportpesa UK.

“We have other development programs such as the Arsenal training camp which is on our cost which will also be affected,” he added.

Online gaming sites started gaining traction in the country about two years ago with Kenya Revenue Authority revealing that the fast-growing industry had helped expand the exchequer’s tax base.

By February this year, 25 licensed betting companies had paid a total of Sh4.7 billion in the financial years 2014-2015 and 2015-2016. Gross revenues from the industry estimated to be around Sh3 billion with predictions showing that the industry may experience steady growth over the next five years.

Betting and Gaming have become widespread in our society in an environment that is inadequately regulated. Its expansion is beginning to have negative social effects in particular on the youth and the vulnerable members of the society,” Treasury Cabinet Secretary Henry Rotich said during the Budget Speech at Parliament in March.

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