Today brought some shocking news that, following the passage into law of the 2017 Kenya Finance Bill, in which the President had amended an increase in the tax on gambling to 35% tax, in place of an earlier 50% one proposed at Parliament, Sportpesa, the apparent industry leader of sports betting and gambling would be ending all its local sponsorships.
As @SportPesa we will be giving notice to clubs and unions that from January 1 we will withdraw all sponsorships.
— Capt. Ronald Karauri (@KarauriR) June 23, 2017
Sportpesa has a sizeable local sports sponsorship portfolio, supporting several local sports ventures; In rugby (the Kenya Rugby Union, Kenya Harlequins), and in soccer (Kenya’s premier league, a Super 8 tournament, Football Kenya company, as well as individual teams of Gor Mahia, AFC Leopards, Football Kenya, Nakuru All Stars).
Sportpesa started operating in Tanzania just two months ago, but recently hosted a soccer tournament in Tanzania featuring top Kenyan and Tanzania teams, which was won by Gor Mahia, earning them a pre-season match with Everton, the English premier league team, on July 13 in Dar-es-Salaam.
The strong-arm tactics of Sportpesa look similar to ones tried by Kenyan banks before the President went ahead and signed an interest capping bill into law that the banks had strongly opposed. The effects they warned about now seem to becoming true with reduced lending to businesses, and liquidity in the economy.
The sports betting and gambling companies push back also comes at a time when Kenyan sports face myriad issues like doping allegations, an ineffectual sports minister and fatigue and funding cutbacks by other large sports sponsors including Multichoice (DStv), EABL, KCB and Safaricom over management issues with different sports associations and teams. While gambling companies like Sportpesa had stepped up, the sports’ funding sources now appear in limbo.