Net Entertainment faces an increased tax bill
After the Swedish Tax Agency finished an audit of Net Entertainment AB’s 2007 to 2010 taxable income, the online gambling software provider is being confronted with a tax bill of SEK92.1 million (£8.72 million).
Initially announced as set to top out at SEK88.1 million (£8.34 million), the new higher amount is down to an error in the previous audit memorandum from the Swedish Tax Agency and imposed interest.
The Swedish Tax Agency mentioned in its latest decision was according to the fact that it had provided certain arrangements between companies in the Net Entertainment group different legal interpretation and economic substance than what the developer and its expert advisors had.
A statement from Net Entertainment read “As has been communicated previously, Net Entertainment disputes the assessment that the Swedish Tax Agency has done and consequently also the amounts as it relates to the income tax adjustment and the tax surcharges,”
“Net Entertainment insists that it has followed applicable laws for taxation of its operations, which is also supported by the experts that the company has consulted on the subject.
“Net Entertainment has its sales, market and product strategic functions as well as customer support and hosting located mainly in Malta where the company has a license to conduct its business while the group’s [development functions are] based in Sweden. Net Entertainment pays taxes according to the applicable laws and based on the operations that are conducted in each country respectively.
“The company will appeal the Swedish Tax Agency’s decision. Net Entertainment does not currently see grounds to make a provision in the accounts for possible additional taxes related to this matter.”