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Everton FC sponsor SportPesa suspends gambling operations in Kenya

Alex Iwobi of Everton during the Premier League match between Everton FC and Manchester City at Goodison Park on September 28 Image copyright Getty Images

Everton football club's main sponsor, sports betting firm SportPesa, has halted operations in Kenya after a rise in tax on betting stakes.

It comes amid worries about the effects of gambling in the African nation.

Online sports gambling firms such as SportPesa have grown rapidly in the East African nation in recent years, riding a wave of betting interest.

The Kenyan government says the betting industry generated revenues of 204bn shillings (£1.6bn; $2bn) last year.

'Severe consequences'

The gambling boom is being fed by faster internet, cheaper phones and a love of the English Premier League. But there is a fear that adults and children are being sucked into a cycle of betting, debt and poverty.

One government minister has called this "a curse on youth", and in May the country introduced new gambling regulations, including a ban on advertising outdoors and on social media.

Parliament has now voted to raise the excise duty on bets, from 10% to 20%.

SportPesa said it was "disappointed" by the move and that it would stop its operations until a "non-hostile regulatory environment" returned. The firm has deactivated its website. It said the new tax comes on top of an existing 20% tax on individual gamblers' winnings.

"This will have severe consequences for licensed betting companies, which dutifully pay their taxes and ultimately will lead to a decline in government tax revenue to near zero and will halt all investments in sports in Kenya," the firm said.

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Media captionSports betting has exploded across Africa, but are the betting companies playing it straight?

"Until such time that adequate taxation and non-hostile regulatory environment is returned, the SportPesa brand will halt operations in Kenya."

SportPesa was founded in Nairobi by Kenyans backed by Bulgarian investors. As well as Everton it has also had partnerships with English clubs Arsenal, Southampton and Hull City.

Whistle-to-whistle ban

It comes amid concerns about the effects of gambling in both the UK and Africa, particularly around sport.

Last December, the UK's biggest gambling companies voluntarily agreed to a "whistle-to-whistle" television advertising ban. The Remote Gambling Association (RGA), which includes Bet365, Ladbrokes and Paddy Power, struck a deal to stop adverts during live sports broadcasts.

It follows political pressure about the amount of betting advertising on TV. The Labour Party has said football clubs will be banned from signing shirt sponsorship deals with betting companies if it were in power.

Gambling giant GVC Holdings, which owns Gala, Ladbrokes and Coral, has said it is stopping all football shirt sponsorship, as well as stopping perimeter advertising at matches.

Everton has previously said it values its "developing relationship with SportPesa, who have demonstrated a strong alignment with our values", in particular around its support for the club's community work.

Meanwhile, the BBC has looked at the dangers of football gambling in both Kenya and Uganda, and found young people and students being sucked into gambling addiction.

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