Code:

import os

width = 10
height = 10

empty_char = "   "
wall_char = "░░░"
bullet_char = [" ▸ ", " ▾ ", " ◂ ", " ▴ "]
tank1_char = ["o>o", "ovo", "o<o", "o^o"]
tank2_char = ["*>*", "*v*", "*<*", "*^*"]
tank1_name = "Arjo's tank"
tank2_name = "Renze's tank"

current_move = 1
tank1 = []
tank1_dir = 0
tank2 = []
tank2_dir = 0
bullets = [] #bullets = [[x, y, direction]]
winner = None

walls = []
for y in range(height):
	walls.append([0 for x in range(width)])

map_1 = '''
xxxxxxxxxx
x1------2x
x-x--xxx-x
x-x----x-x
x---xx-x-x
x-x-xx---x
x-x----x-x
x-xxx--x-x
x--------x
xxxxxxxxxx
'''


def generate_map(map_string):
	global tank1, tank2, walls

	for y, line in enumerate(map_string.splitlines()[1:]):
		for x, char in enumerate(line):
			if char == 'x':
				walls[y][x] = 1
			else:
				if char == '1':
					tank1 = [x, y]
				elif char == '2':
					tank2 = [x, y]
				else:
					walls[y][x] = 0


def draw_winner():
	os.system("clear")

	if winner == "tie":
		print("It's a tie!")
	else:
		print("The winner is: "+winner+"!")


def draw_screen():
	
	# Clear the screen
	os.system("clear")

	# Prints the battlefield
	for y in range(height):
		draw_line = ""
		for x in range(width):
			if [x, y] == tank1:
				character = tank1_char[tank1_dir]
			elif [x, y] == tank2:
				character = tank2_char[tank2_dir]
			elif walls[y][x] == 1:
				character = wall_char
			else:
				character = empty_char
				for b in range(len(bullets)):
					if (x == bullets[b][0]) and (y == bullets[b][1]):
						character = bullet_char[bullets[b][2]]
			draw_line += character
		print(draw_line)

	#Prints the information
	print("MOVE "+str(current_move))


def do_action(tank, action_type):
	global tank1_dir, tank2_dir, bullets

	# RETURN CODES #
	# 0: no wall, tank moves to that place
	# 1: wall or other tank, tank stays on the current place
	# 2: illegal move

	if tank == 1:
		xx = tank1[0]
		yy = tank1[1]
		_xx = tank2[0]
		_yy = tank2[1]
		tank_dir = tank1_dir
	elif tank == 2:
		xx = tank2[0]
		yy = tank2[1]
		_xx = tank1[0]
		_yy = tank1[1]
		tank_dir = tank2_dir
	if action_type == "left":
		if (walls[yy][xx-1] == 0) and not ((xx-1 == _xx) and (yy == _yy)):
			tank_dir = 2
			xx -= 1
		else:
			return 1
	elif action_type == "right":
		if (walls[yy][xx+1] == 0) and not ((xx+1 == _xx) and (yy == _yy)):
			tank_dir = 0
			xx += 1
		else:
			return 1
	elif action_type == "up":
		if (walls[yy-1][xx] == 0) and not ((xx == _xx) and (yy-1 == _yy)):
			tank_dir = 3
			yy -= 1
		else:
			return 1
	elif action_type == "down":
		if (walls[yy+1][xx] == 0) and not ((xx == _xx) and (yy+1 == _yy)):
			tank_dir = 1
			yy += 1
		else:
			return 1
	elif action_type == "shoot":

		new_bullet = [xx, yy, tank_dir]
		bullets.append(new_bullet)

	elif action_type == "turn_left":
		tank_dir = 2
	elif action_type == "turn_right":
		tank_dir = 0
	elif action_type == "turn_up":
		tank_dir = 3
	elif action_type == "turn_down":
		tank_dir = 1
	elif action_type == "pass":
		pass

	if tank == 1:
		tank1[0] = xx
		tank1[1] = yy
		tank1_dir = tank_dir
	elif tank == 2:
		tank2[0] = xx
		tank2[1] = yy
		tank2_dir = tank_dir
	return 0


def check_collision(bullet):
	bul_x = bullet[0]
	bul_y = bullet[1]

	if walls[bul_y][bul_x] == 1:
		return True
	else:
		return False


def move_bullets():
	global bullets, winner
	
	bullets = [bullet for bullet in bullets if not check_collision(bullet)]

	for i in range(len(bullets)):
		

		direction = bullets[i][2]
		if direction == 2: #left
			bullets[i][0] -= 1
		elif direction == 0: #right
			bullets[i][0] += 1
		elif direction == 3: #up
			bullets[i][1] -= 1
		elif direction == 1: #down
			bullets[i][1] += 1

		# Check collision with the tanks
		if (bullets[i][0] == tank1[0]) and (bullets[i][1] == tank1[1]):
			if (bullets[i][0] == tank2[0]) and (bullets[i][1] == tank2[1]):
				winner = "tie"
			else:
				winner = tank2_name+" ("+tank2_char[0]+")"
		else:
			if (bullets[i][0] == tank2[0]) and (bullets[i][1] == tank2[1]):
				winner = tank1_name+" ("+tank1_char[0]+")"


def update():
	global current_move

	move_bullets()
	draw_screen()
	current_move += 1


def arjo_ai():
	arjo_action = "right"
	print("I did action "+arjo_action)
	return arjo_action


def main():
	generate_map(map_1)
	update()
	while winner == None:
		#do_action(1, arjo_ai())
		arjo_action = input(tank1_char[tank1_dir]+" ")
		do_action(1, arjo_action)

		renze_action = input(tank2_char[tank2_dir]+" ")
		do_action(2, renze_action)
		update()

	draw_winner()

main()