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BBI Report: Replace private betting industry with one run by government

SPORTS By Frankline Sunday | November 27th 2019 | 2 min read
Kenyan currency [Courtesy]

As income inequality widens, the lowest-income households in Kenya spend a lot on lottery tickets. This is one of the key concerns raised in the Building Bridges Initiative report, which claims Kenyans spend tens of billions of shilling on lotteries each year.

The report recommends that the government sets up a national lottery, whose earnings could be ploughed back to empower the youth.

Besides this, the report recommends many other avenues through which the government can empower the youth.

“The private betting industry is leading to hopelessness and greater poverty,” states the report in part.

“The task-force suggests that the private betting industry be replaced with one major one run by government, whose proceeds, as is the case in other countries, are used for activities that uplift the youth, sports, culture and other social activities beneficial to citizens.”

If the recommendation is adopted, Kenya could see big sports betting companies closed down, sounding the death knell on a brief but controversial reign that they have enjoyed in the lucrative sector.

Last August, Interior Cabinet Secretary Fred Matiangi said sports betting firms owed the country more than Sh26 billion in unpaid taxes, and threatened to immediately deport any foreigners engaged in the business under false visas.

Currently, the Kenya Revenue Authority is locked in a legal battle with betting companies seeking to have a 20 per cent Income Tax charged on the stakes placed by gamblers.

The recommendation will also see Kenya have the first national lottery, the closest such institution being the privately run Kenya Charity Sweepstake that was founded in 1966.

Stakes acquired

Earlier this year, UKs Tenlot Group Ltd, a unit of private equity firm Elenilto Group Ltd, acquired an 85 per cent controlling stake in the Kenya Charity Sweepstake.

The BBI report also recommended creating a special tax regime for young entrepreneurs running micro- and medium-sized enterprises, including a tax holiday of at least seven years.

An advisory desk manned by a business development expert will also be set up in every Huduma Center to help youth start businesses.  

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