Sponsorships Cut Out as Taxes on Gambling in the Czech Republic Rise

A bunch of changes have been made by the Czech Republic of late regarding the rules involved in the tax regime for online gambling. As expected, the result is such that, the situation looks very dreary for some sports organizations. Many of these directors and chairpersons have been in the news voicing their disappointment and anger regarding the same, calling out on the unprofessional, populist approach of the Czech legislators.Taxes on Gambling

High profile sponsorships have been cancelled by sponsor Czech gambling operator SynotTip. This has been done to stand up against the new gambling tax measures that have been put into action recently.  It was a great shock for the Czech sports organizations to hear about  The SYNOT Group, which is known all over the world as  respected structure of companies working in 13 different countries. Not just this, this company that employs approximately 3, 000 people has now withdrawn its support along with its sponsorship. The same was approved by none other than the Czech government in support of levying tax on winnings from lotteries. In this process sports betting is to be increased from 20 percent to 23 percent and slot machine winnings will be having a 28 percent tax rate. Reports and studies say that during the time of deliberations on the ruling the measure is expected to contribute an estimated 2 billion crowns to the government`s coffers. In the past four years, this increase was the second rate increase to have happened.

Synot Tip has been giving statements regarding the same, saying that all this is due to the sudden increase in taxes in the lottery industry. They have also said explicitly that they will no longer be involved in most of its sponsorship and advertising activities, if not all, when speaking of sports organisations in the Czech Republic. The Director of Synot Tip International Ltd, Neofytos Neofytou, was reportedly appalled by the “unprofessional and populist approach” of the Czech legislators regarding the generation of revenue. Neofytou said that the increased tax would cost the firm, “hundreds of millions of crowns” and so they won’t be able to sustain the any of the activities from then on, any further.

Ivo Valenta , who is the chairman of Cyprus-based parent company of the Synot Tip enterprise, WCV World Capital Ventures Limited said with certain vehemence that it was “not possible” for a foreign company to be able to subsidize business in the Czech Republic. Valenta also quoted to have said that said Synot Tip would be using the very few resources that it was left with after having paid the newly imposed Czech tax in order to support sport in the other countries where lottery operations of these kinds will be conducted. It is to be noted that the withdrawal of support by Synot Tip will mean that they will be putting an end to their four-year deal as the prime sponsor of the Czech Liga top-tier football series.

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