An Icelandic company has today failed in its appeal against the tax authority’s decision not to allow it to claim ISK 250 million (EUR 2.11/USD 2.26 million) in sports betting losses as tax deductible.
The speculative investment company claimed that before the 2008-9 financial crisis it had been engaged in speculative investments in foreign currencies—which is basically just betting on future exchange rates.
The claim states that the imposition of strict capital controls in Iceland ruined this side of the investment business right away, and that the company owner decided to react by ‘investing’ in sports betting on the website BetFair.com.
The company racked up losses of ISK 250 million which it later claimed as tax deductible, but the internal revenue service disagreed. The company appealed and has now lost that appeal as well.
The main reason for the rejection of the appeal is simply that the owner had registered his BetsOn account in his own name and betted on basketball and football under his own name, though using his company’s credit card, Vísir reported.
Regardless of this, the panel agreed, sports betting can never be considered investment activity under law.