Dar es Salaam — The popular betting firm SportPesa says it will continue to operate in Tanzania after exiting Kenya following a standoff over taxation.
The firm said yesterday that there is nothing to worry about its operations in Tanzania because the companies operated in the two countries as separate entities.
SportPesa announced it would halt its operations in Kenya due to what it termed as a hostile operating environment. This was after the government changed the taxation regime on the betting industry.
Kenya passed a Finance Bill 2019 that introduces a 20 per cent excise duty on staked amounts.
The Treasury had proposed a ten per cent excise duty - but the National Assembly's Committee on Finance and Planning increased it to 20 per cent, noting that it was meant to be punitive and dissuade people from betting.
Imposition of the tax annoyed the betting company, saying that the tax would make betting unattractive.
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Halting operations in Kenya triggered worries on the fate of the Tanzanian edition of SportPesa. But the firm said there'd be no adverse effects.
"We are two different companies operating in two different countries.Although we are related, there is no possibility of adverse effects in Tanzania," the SportPesa-Tanzania director of administration and compliance, Mr Tarimba Abbas, said.
"In Tanzania, we have not any issues relating to compliance," Mr Abbas told The Citizen on the 'phone.
Sports betting has become a favourite pastime for many young people - some just for the fun of it, while others have turned it into a source of income.
The trend created fears and ethical concerns, making the government to suspended gaming advertisements early this year. However, the adverts are now allowed in the evenings.
According to the Gaming Board of Tanzania, the subsector contributed Sh78 billion to government coffers during the 2018/19 fiscal year, a relatively steep rise from the Sh11.4 billion it contributed in the 2012/13 financial year!
The board projects that the sub-sector will contribute over Sh100 billion in the 2019/20 financial year.