Early Sunday, Pambazuka National Lottery announced that it had suspended operations in Kenya citing high taxes imposed by Government.
“Operating any lottery under this framework is not possible and therefore business operations are forced to close,” the firm said.
The firm added that 35 per cent tax on all tickets sales has made them to suspend their operations until a "sustainable regulatory framework" is in place.
“The effect of the 35 per cent tax on all ticket sales is that the total cost of operations rises to 115 per cent and this is before deduction of operations costs,” read part of the statement.
With the new tax, Kenya now has the highest rate globally for this industry given that the companies will also pay other taxes such as corporate tax.
Pambazuka’s decision comes just days after SportPesa pulled out its sports sponsorship, saying the 35 per cent tax imposed by the Government was too high.
This means that Sh600 million will be lost every year as sponsorship funding.
The Kenyan Premier League will also be affected as SportPesa was its official title sponsors. Others to be affected are the SportsPesa grassroots tournament, Nakuru All Stars, as well as Kenya Harlequin rugby team.
The World Boxing Council women’s super-bantamweight champion, Fatuma Zarika, and local rally driver, Leonardo Varese, are also affected.
FKF will have to get money to pay national team coach Paul Put and technical director Andreas Spiers, who were both paid by the betting firm.