Betting firm Sportpesa on Monday explained its finances and tax records to the public.
In a full-page The Standard advert, the company said it collected Sh20 billion in revenues, made Sh9 billion in gross profit and paid Sh6.4 billion in taxes in 2018.The announcement is against the backdrop of accusation on the industry’s tax commitment to the government.
A report by a multi-agency team set by the state indicated that betting companies made about Sh204 billion last year but paid only Sh4 billion in taxes.Defending its activities, the betting firm further listed a number of social responsibility within the sports community and local communities.On the socio-economic investment, the company says it invested Sh693 million in football, Sh 600 million in rugby, Sh 75million in boxing, Sh2.8million rally, Sh73 million in agriculture, environment conservation, water access, Sh57 million in education infrastructure and Sh41 million in community health development.The gaming firm also listed sports activities it sponsors in the country.It says, it sponsors the Kenyan Premier League and the official title sponsor of the Federation of Kenya Football Shield tournament, which provides an invaluable opportunity for the teams to display their talent.The advert also says the company has been running an initiative called Kits4Africa that encourages football fans to donate their old kit to underprivileged, grassroots teams across Africa.
SportPesa also has a sponsorship deal with football giants Gor Mahia and AFC Leopards.The announcement comes two days after the government ordered Safaricom to stop processing payments for sports betting companies, potentially shutting down a lucrative source of revenue for the companies.Many Kenyans argue that the closure of the betting accounts will impact heavily on millions who have made betting an occupation.The growth of gambling in Kenya in recent years has been fueled largely by increasing public acceptance of gambling as a form of recreation, and by the promise of substantial economic benefits and tax revenues for the government.SportPesa is among the 27 companies whose licences have not yet been renewed for what it said was failure to comply with various regulations.
Lasy year betting firms accounted for 22 per cent of the Sh95 billion that media houses earned in advertising revenues, a far cry from 0.3 per cent in 2014.The financial services sector came in second, accounting for 14 per cent, followed by food processing firms (nine per cent), the communications industry (eight per cent) and beverages (eight per cent).Despite splashing billions to increase its visibility, the betting industry is staring at a bleak future, with the Government proposing controls on advertising.
This could possibly hurt revenues for both media houses and the betting firms since the latter rely on constant messaging to reach their target audience.The report showed that half of the top 10 advertisers in the country all come from the betting industry. The key players are Shabiki, Sportpesa, Tatua, Lotto and Supa 5.