The COVID-19 induced suspension of sporting activities has crippled the sports betting industry in Nigeria, thereby depriving the government of the revenue it normally earns from the sector through taxation. This was disclosed by Honourable Akin Alabi, a federal lawmaker and founder of Nairabet.
Alabi, who represents the Egbeda Ona Ara Federal Constituency at the Federal House of Representatives, stated this during the weekly Nairametrics Tweet Chat on Thursday evening.
According to the entrepreneur, if the COVID-19 pandemic lasts much longer, thousands of staff would be laid off and many entrepreneurs would go out of business.
Terrible. No sporting activities. And that’s the driving force of the industry. Yes there is virtuals and casinos but they thrive when there is “ginger” of real sports. Many companies are laying off staff. Many will go out of business. Many won’t be able to renew licenses.
— Oloye Akin Alabi (@akinalabi) April 30, 2020
He then talked about multiple taxation, noting that entrepreneurs in the sports betting industry have been battling with this issue. The federal and state governments both strive to lay claims to taxes, he said.
(READ MORE: COVID-19: Shutdown of sports is crippling the world economy – Oma Akatugba)
A lot. We intervened in the issue of FIRS trying to impose VAT and customers when they bet. We are also working on the Lotteries act because when the act was created, there was no sports betting so some of the laws in it is impossible to adhere to. It must be amended. pic.twitter.com/tMtDKcoc10
— Oloye Akin Alabi (@akinalabi) April 30, 2020
Commenting on why the sports betting industry is thriving in Nigeria, Alabi attributed it to Nigerians’ love for football. He also explained that many Nigerians are attracted to the industry because of the transparency in the system. Winners are paid their claims and winnings as at when due.
Note that the monthly taxes and levies paid by the sports betting companies form part of the federal government’s revenue streams, which is then used in funding the national budget.
We love football. Proof factor. We can see the results. The system can’t cheat you because you chose Chelsea to win and if they win you can see for yourself. The humongous tax and levies sports betting companies pay as good causes money every month goes into the FG accounts…
— Oloye Akin Alabi (@akinalabi) April 30, 2020
Alabi described sports betting as the ‘best seller’ of the betting industry, expressing optimism that things would return to normal eventually when the pandemic is all over.
“It will surely bounce back. Once football returns, the excitement will return. In my first year in the business when the season ended, I was afraid of people not coming back to the new season. They came back,” he said.
Nairametrics weekly tweet Chat features top personalities across different sectors, who answer important questions from the Nairametrics team and the general public.
