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Economy

SportPesa asked to seek fresh licence after KRA truce

Ronald Karauri
Sportpesa CEO Ronald Karauri. PHOTO | MARTIN MUKANGU 

Betting firm SportPesa will have to apply afresh for a licence, the regulator now says.

Acting Betting Control and Licensing Board (BCLB) director Peter Mbugi Thursday said the they will scrutinise SportPesa’s application once it’s submitted and consider whether to give its nod for the firm to resume operations.

“We will scrutinise the firm’s licence application and make a decision on this just like we have done for many others,” said Mr Mbugi.

He said the regulator had given the green light to several gaming firms and operators after due diligence on their applications.

SportPesa said recently it had reached a truce with taxman to resume operations once cleared by the BCLB.

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Together with its rival Betin Kenya, they were among 27 firms whose permits were not renewed awaiting the outcome of an inquiry on suitability to operate.

SportPesa chief executive Ronald Karauri did not, however, respond to Business Daily queries by the time of going to press. It was also not immediately clear whether the firm has lodged a fresh application after an earlier one was rejected following a tax compliance row with the KRA.

SportPesa had said earlier that it has since been cleared by the taxnam, setting stage for its return to operations after an over two-month absence.

KRA in June demanded Sh8.59 billion from Safaricom as withholding tax arrears due from SportPesa and Betin Kenya, in a crackdown of the Sh200 billion sector.

KRA was demanding that Safaricom pays Sh5.29 billion withholding tax arrears due from Gamcode Limited, trading as Betin, and a further Sh3.29 billion due from Pevans East Africa, which trades as SportPesa.

In an earlier interview, Mr Karauri said that “all pending issues had been settled” and a deal reached which should see the firm get back to business as soon as BCLB clears it.

“We have held talks with KRA and they have allowed us to get back to business,” said Mr Karauri then.

Sports betting companies’ combined revenue hit Sh204 billion last year.

According to SportPesa records, it paid Sh400 million last year as withholding tax on winnings.

This was in addition to Sh3.6 billion betting tax, Sh1.12 billion corporate tax, Sh722.9 million withholding tax, Sh183.4 million withholding value-added tax and Sh269.6 million pay-as-you-earn for its 367 employees. This amounted to Sh6.29 billion in taxes up from Sh3.63 billion paid in 2017.

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