By Khalifa Hemed
Published August 28, 2019
In a move that is largely viewed as an attempt to inculcate the ethic and value of hard work among the youth and discourage short cut to success through luck and fatalism, the Government of Kenya has since the beginning of July 2019 denied several major sports betting firms trading licences.
Using non-tax compliance excuse for its crackdown on operators of gambling companies, the Government, despite many of the gaming firms having secured orders from the courts allowing them to continue operating as they negotiated tax compliance with Kenya Revenue Authority (KRA), has frozen the bank accounts and ordered telecoms to withdraw paybill numbers, SMS and short codes used by betting operators and stop processing payments for sports betting companies. The Government has also deported several foreigners behind some of these companies, many of which are viewed as a threat to both moral and economic fabric of Kenya.
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This is hardly surprising as President Uhuru Kenyatta has not only declared corruption a national security threat, but is also engaging in an all out war against graft and impunity, two of the vices that are said to be favouring the gambling business in Kenya.
Both the Directorate of Criminal Investigation and Office of the Director of Public Prosecution are relentless going after people accused of possible tax evasion whom they arrest and charge in court even though the Judiciary is viewed as an obstacle to this war as it often rules in favour of suspects against the Executive arm of Government.
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During a two-day conference on governance, corruption and the impact of the latter on Kenya in January 2019, President Kenyatta challenged ‘the Judiciary, and in particular, the Judicial Service Commission, to deeply reflect upon and correct areas of weakness that are clearly present in our judicial system’.
Saying ‘The identities of Commissioners and Senior Judicial Officers who have broken their Oath of Office and betrayed the People of Kenya are widely known,’ the President said ‘The Judicial Service Commission and the wider Judiciary must now decide whether they shall clean their house themselves or have it done for them’.
The President had in his official speech noted that corruption had both ‘permeated every aspect of our lives’ and
‘impeded the social and economic development of Kenya.
Kenyatta said ‘Corruption has become an accepted way of life, sacrificing traditions, customs and values on the altar of materialism’.
It is through this ‘altar of materialism’ on which ‘traditions, customs and values’ are sacrificed that betting companies come into the equation.
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Over the years since Kenya’s independence from Britain in 1963, mchezo wa kamari, karata or pata-potea was discouraged and anyone found engaging in these gambling activities would be arrested and charged in court. This was a vice that was viewed as encouraging people to rely on luck instead of hard work to improve their lot.
To prevent disruption of their business as Government had warned any operator with non-tax compliance problem wouldn’t be allowed to operate from July 1, betting firms had rushed to the High Court that had issued an order barring Betting Control and Licensing Board (BCLB) and other Government agencies from stopping them from operating after June 30.
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Fred Matiang’i, Kenya’s Minister for Interior, ordered the arrest of any gambling outfit found operating without license. Matiang’i argued that no country has ever developed from gambling businesses and that the Government cannot just watch gambling operators corrupting the morals of young Kenyans. Hence the Government has had to crack the whip.
Twenty-seven companies–AGB Lottery & Gaming, SportPesa, Chezacash, Betin, Saharabet, Betpawa, Premier Bet, Dafabet, Elite Bet, Premierbet, Lucky 2 U, 1XBet, Mozzartbet, World Sport Bet, Atari Gaming, Palmsbet, Bet Boss, Betyetu, Elitebet, Bungabet, Cysabet, Nestbet, Easybet, Kick Off, Eastleighbet, Millionaire Sports Bet and Kenya Sports Bet–have been denied trading licenses by BCLB.
Besides accusations of tax evasion–the Government says the firms paid only Sh4 billion out of Sh204 billion income they made in 2018–the Government accuses betting firms of money laundering and creating a culture of laziness and fatalism among young Kenyans.
The standoff between betting firms on one hand and Government on the other is unlikely to end any time soon, judging by the stand of President Kenyatta who says they must be tax-compliant.
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Saying ‘The government must get its share to fund activities that are beneficial to this country,” Kenyatta contends ‘Some firms have been hoarding taxes but we have managed to push them to pay and we will continue doing so’.
Though ‘Those in the betting companies are our friends,’ the President argues, ‘we have to agree that the government must get its rightful share to build cultural centres and other developments’.
Kenyatta says the affected firms should seek to regularise their operation instead of trying to blackmail his Government through threats of going to courts that have often ruled against the Executive arm of Government.
