New Czech Gambling Taxes Results In Axed Sponsorships

Published Friday, January 22, 2016 - Online-Casinos.com
New Czech Gambling Taxes Results In Axed Sponsorships

The Czech Republic has recently made changes to the tax regime for online gambling and the result has not been positive for some sports organizations. Sponsor Czech gambling operator SynotTip has cancelled its high profile sponsorships in protest over the new gambling tax measures imposed recently. Czech sports organizations were shocked to hear The SYNOT Group,  an international, respected structure of companies operating in 13 countries worldwide and employing approximately 3 000 people has withdrawn its support and sponsorship. Approval was made by the Czech government for the tax on winnings from lotteries and sports betting to be increased from 20 percent to 23 percent, while slot machine winnings will have a 28 percent tax rate. According to a report during the deliberations on the ruling the measure is expected to contribute an estimated 2 billion crowns to the government`s coffers. This increase was the second rate increase in the last four years.

Due to the “sudden increase in taxes in the lottery industry, ” Synot Tip said in a statement it will no longer be involved in, “most of its sponsorship and advertising activities” with sports organizations in the Czech Republic.  Director of Synot Tip International Ltd, Neofytos Neofytou, is said to be “shocked” by Czech legislators’ “unprofessional and populist approach” to revenue generation. Neofytou said the increased tax would cost the firm, “hundreds of millions of crowns” and thus it “simply cannot support” sponsorship activities any further.

Cyprus-based parent company of the Synot Tip enterprise WCV World Capital Ventures Limited, chairman Ivo Valenta, said it was “not possible” for a foreign company to be “subsidizing business in the Czech Republic.” Valenta also commented that said  Synot Tip would use “the very limited resources” it had left after paying the new Czech tax to support sport in the other countries in which it conducts lottery operations. The withdrawal of support by Synot Tip includes cancelling its four-year deal as the title sponsor of the Czech Liga top-tier football series.

 

 

 

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