Playtech has agreed to pay Israeli authorities approximately £25 million following a civil tax audit assessing its activity in the country between 2008 and 2017.
The gambling software company confirmed this morning that it had reached a settlement on 31 December 2018, after acknowledging that the Israeli tax authorities had made “transfer pricing adjustments in relation to certain functions”.
The payment, expected to be made in the next 30 days, will be reflected as an exceptional item in the firm’s 2018 accounts. No further penalties are to be imposed as a result of the audit.
The news closes a turbulent year for Playtech, who now expect to take an earnings hit of up to €25 million (£22.5 million) in 2019 due to changes in Italy’s gambling taxes.
Online casino revenues will be taxed at 25% (up from 20%), while online sports betting will be subjected to a 2% increase from 22 to 24%. This is on top of the advertising ban, announced as part of the Lega-5 Star government’s ‘Dignity Decree’.
Playtech had moved to offset falling revenues in Asia by completing the acquisition of Italian betting group Snaitech for approximately €850 million in June of last year.