SportPesa and Betin have issued a notice halting their operations in Kenya as a result of new tax measures imposed by the government.
SportPesa and Betin through a notice cited their 20 percent withholding VAT imposed by Finance CS Henry Rotich as the root of all problems.
They further cited misunderstanding on how revenue sharing works and the unfairness brought about by the new VAT measures.
Also read: Kenya Revenue Authority clears SportPesa
Winners are the most affected lot as they do not enjoy the full amount they are expected to collect.
Betin, on the other hand, cited financial constraints following the move making it hard for them to sustain their business model.
It is from the aftermath of the new measures that they have resolved to send home its entire workforce at the end of October 2019.
Plans are already in place to discuss the redundancy issue with its employees as required under the Employment Act.
Trouble began for betting firms when KRA accused them of non- compliance in declaring VAT leading to billions in uncollected revenue.
Licenses were canceled as Interior CS Fred Matiang’I threatened to export foreign managers implicated in the matter.
Contracts between the firms and local clubs were canceled as collective agreements were being established with the government.
Local clubs called for a solution as they have benefited greatly from their sponsorships when it came to facilities and exposure.
As at today, the firms have not yet reconciled their tax submission with Kenya Revenue Authority.