Betting company Betsafe has announced its exit from the Kenyan market, citing heavy taxation imposed by the government in the industry.
According to Betsafe Chief Executive Officer (CEO) Victor Simiyu, the company ceased operations effective May 14, 2023.
In an email seen by Waza, the company informed customers that they would be refunded their outstanding balances within seven days.
”Your outstanding player balances will be refunded via M-Pesa to your registered number within 7 days,” read the message.
The betting company was launched in Kenya in late 2020 through Bet High Kenya, a Kenya subsidiary of Betsson Group.
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Betsafe joins other big players like Betin and Betway that exited Kenyan operations in 2023 owing to the unsustainable tax regime.
The Kenya Revenue Authority (KRA) announced that betting taxes increased by 30 percent to Kes 15.1 billion in the last financial year through excise on betting and withholding on winnings.
In an announcement in July 2023, the taxman attributed the growth to stricter deductions from betting firms.
The excise duty on betting rose by 116.2 percent to Kes 6.64 billion, and withholding tax from winnings jumped to Kes 8.6 billion.
Further, KRA attributed its high revenue collection to integrating betting companies into its tax system.
The integration of betting companies with the KRA system began in mid-October 2022. The goal was to collect the 7.5% excise duty on bets and the 20% withholding tax on wins from the companies daily.
The program kept KRA's promise to simplify industry tax payments to increase revenue mobilization and collection.
The Authority is now integrating the final 87 betting companies into the system.
“Other initiatives under the tax-at-source programme include the Electronic Tax Invoice Management System (eTIMS), which has minimised VAT fraud and enhanced tax revenue,” KRA said.
Additionally, KRA stated that 95,732 VAT-registered taxpayers were onboarded, which led to remittances of Kes 272. 365 billion.
