Kenya threatens telecom op Safaricom with betting tax grab

Kenya’s leading sports betting operators are reportedly having trouble paying customers after the government froze their accounts with the country’s leading payment processor.

Earlier this month, news broke that betting operators SportPesa and Betin had filed separate lawsuits challenging claims by the Kenya Revenue Authority (KRA) that the two operators owed billions of shillings in uncollected withholding tax on punters’ winnings.

The money sought by the KRA is based on a 20% tax on bettors’ winnings, the legality of which has been in question for years due to a SportPesa punter’s legal challenge. SportPesa has maintained that it cannot remit any withholding tax while the challenge is ongoing, while the KRA maintains that the court orders apply only to the individual punter, not the rest of the betting company’s clientele.

On Monday, Business Daily Africa reported that KRA manager for debt enforcement Asha Salim had written the CEO of Safaricom – Kenya’s leading telecom operator, which runs the popular M-Pesa mobile money transfer service – demanding that the company immediately remit the sum of Ksh8.58b (US$84.3m) that the KRA maintains the two betting operators owe the government.