This archive report was first published on 4 October 2019.
October 4, 2019 - In a shocking move, betting firm SportPesa has fired all employees of its Kenyan operations, leaving 362 workers jobless. The company cited hostile regulatory and taxation regimes as the reason for its exit from the country.
According to an insider, SportPesa has given its employees notice depending on their contract and has promised to honour their contractual obligations in full. This move comes just a few days after the company announced its decision to quit the country.
On Wednesday, SportPesa told its employees that they would be laid off as the company finalises its exit from the country. This is the second major blow to the sports betting industry in Kenya, following the exit of Betin, another major player in the industry, which fired all its 400 employees last week.
Both SportPesa and Betin had attempted to engage with the Government to ensure their continued operations, but to no avail. SportPesa had cited the 20 per cent excise duty on all betting stakes as the major factor that led to its exit, stating that it would be absent from Kenya until such time that an adequate taxation and non-hostile regulatory environment is returned.
The exit of SportPesa and Betin could be a big blow to sports sponsorships in Kenya, as the two firms financed sporting activities. Kenyans have reacted differently to the news, with some noting that the Government could have made an effort to save the jobs that were lost, while others said the jobs lost were a minor loss compared to the damage that betting has caused in the country.
It is worth noting that SportPesa and Betin are among the 27 betting firms whose licences were not renewed by the Government owing to tax noncompliance with the Kenya Revenue Authority. The tax agency demanded billions of shillings from the companies, and the industry has been resisting attempts to increase taxation, particularly a proposal by the National Treasury to introduce a 10 per cent excise duty on all stakes.
