Sportingbet Agrees €17 Million In Spainish Back Taxes

Sportingbet Agrees €17 Million In Spainish Back TaxesAhead of June 1st when Spain is expected to grant a number of gambling licenses, the government announced that many of the hopeful companies would now be liable for millions of euros in back taxes.
Although the policy initially caused a bit of a stir, it didn’t take long before bwin.party carried out a self-assessment tax return and agreed to hand over €33.6 million in order to gain a foothold in the lucrative Spanish market.
A few days later and Sportingbet has now followed suit after accepting liability to pay €17.2m (£13.8m) back taxes for its Spanish operation between January 2009 and May 2012. Previously, online operators receiving revenue from Spanish customers had managed to dodge Spanish taxes, but a reinterpretation of two pieces of tax law now makes their obligation clear. As a Sportingbet statement explains:
“Prior to the recent approach from the Spanish authorities, these laws had been applied to operators based in Spain carrying out offline gaming activities and to certain kinds of bets [other than fixed odd bets].”
Having now carried out its own  self-assessment, Sportingbet has therefore acknowledged €14 million in tax liability plus €3.2 million in surcharges and interest. In order to meet the extra cost, Sportingbet will sell £15 million of convertible bonds on May 25th, with a company statement then elaborating:
“Sportingbet expects the payment to qualify the Company for the Spanish eGaming licensing round which is expected to be issued on 1 June 2012.”
The UK e-gaming operator is aiming to increase the proportion of its gaming revenue derived from regulated markets, with Spain presenting particularly attractive possibilities. In 2010, the Spanish gambling market was worth €9.5 billion in gross revenues, and has an online gambling market expected to reach €800 million by 2014.
After its announcement to pay the €17.2 million in taxes, Sportingbet share price rose 0.50p to 27.50p in early trading.


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