Kenyan betting firm SportPesa has cancelled all of its local sports sponsorships with immediate effect, following the imposition of a 35% tax on all gambling revenues, according to GameYetu.
The betting firm has claimed that despite the contract cancellations, they will not be closing their operations in Kenya. Nevertheless, the decision has plunged much of Kenya's sporting community into a state of panic.
Sportpesa finally cancels all local sports partnerships. Well, hope with the money collected from the 35% tax the government can channel it to sports— brian kuira (@kuirab) January 2, 2018
The Kenyan Rugby Union (KRU) released a statement, in which they acknowledged the importance of SportPesa's funding and asked for the government to now step up: "SportPesa has been a key partner in our planning and growth and has supported our sport at every level.
"The cancellation of this contract forces us to completely reexamine our structures and we immediately call upon the government to step into the breach and provide the necessary support as guided by the Sports Act."
The terminations will also affect Kenya's football leagues, with Nick Mwendwa, Football Kenya Federation President, revealing that they will now lose out on Sh120 million a year (£0.85m).
Two of Kenya's football teams, the AFC Leopards and Gor Mahia, are consequently facing financial ruin - with SportPesa's sponsorships their only source of income.
“As it is even what we receive from SportPesa is not enough to cover our obligations. It will be tougher for us and we could be forced to go back to begging from politicians, which is not sustainable in the long run. We have to find a way to convince Parliament to change this law, otherwise we are all doomed,” Dan Mulee, the AFC Leopards chairman, said.
Furthermore, Jack Oguda, the Kenyan Premier League chief executive, has confirmed that the local clubs will have to take further cuts on their monthly grants, following SportPesa's decision to pull out.