Information on the results of the tax inspection

The Management Board of Orzeł Biały S.A. (hereinafter referred to as “The Company”, “The Issuer”) hereby makes notice, with reference to the Current Report No 26/2019 of 21.08.2019, about the subsequent results of Tax Inspections regarding the reliability of the declared tax assessment bases and the correctness of calculating and paying corporate income tax in 2014 through 2017.
As a result of the inspection for 2017, in the opinion of the Authority, the controlled Company could, when submitting “Information on income tax deductions and reliefs and tax-free and tax-exempt income” – CIT-8/O for 2017, have demonstrated a loss deduction of up to 50% of the 2013 loss figure and could not have deducted the 2014 loss of up to 50% of the loss figure since the deduction limit was used up in 2016.
Therefore, according to the Authority, in the settlement of corporate income tax of The Company for the year 2017, The Issuer should have recognised under “Deduction from Income” the amount
of kPLN 209.4 instead of PLN 7.2 million, under “Tax Base” the amount of PLN 20.9 million instead of PLN 14.0 million, which would mean the necessity to pay an added tax in the amount of PLN 1.3 million plus tax interest. The above findings of the Authority are a consequence of the results of customs and fiscal inspections for 2014 and 2015, about which The Issuer informed in Current Report No 26/2019 of 21.08.2019.

In addition, The Issuer informs that it received the result of the inspection for 2016 where no irregularities were found in the scope of settlement of corporate income tax including the amount of the deduction of any loss from previous years.
Furthermore, The Issuer announced in the interim report for the first half of 2019, under E.2. “Indication of significant proceedings pending before a court, a competent arbitration body or public administration body, published on 25.09.2019, the conversion of customs and tax inspection for 2014-2015 into tax proceedings.
The Management Board of The Company decided, in order to exercise due diligence, after having reviewed the Inspection Results for 2016 and 2017 jointly, to disclose this confidential information to the public at an early stage. The Issuer may not exclude that in the future the results of the customs and fiscal inspection with any decision unfavourable to The Company may affect the results of The Company.
The Issuer will analyse in detail, together with its tax and legal advisors, the Inspection Results received and will keep the public updated on any further relevant activities in this area in accordance with applicable regulations.

Legal basis: Article 17 Para. 1 MAR – Insider Information
Time: 17:35

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