Company: PERI
Filing Date: 2025-03-25
Form Type: 20-F
Source: 0001178913-25-001021
Chunk: 72

Company: Perion Network Ltd.
Filing Date: 2025-03-25
Form: 20-F
Item: Item 5
Chunk 72
---
 ordinary shares,
including, in particular, the effect of any foreign, state or local taxes.

General Corporate Tax Structure in Israel

Taxable income of Israeli companies is generally subject to corporate
tax at the rate of 23%. However, the effective tax rate payable by a company that derives income from a Preferred Enterprise or a Preferred
Technological Enterprise (as further discussed below) may be considerably lower.

Under Israeli tax legislation, a corporation is considered as an
“ Israeli resident company” under the Ordinance if it meets one of the following: (i) it was incorporated in Israel; or (ii)
the control and management of its business are exercised in Israel.

Foreign Currency Regulations

We are permitted to measure our Israeli taxable income in U. S.
dollars pursuant to regulations published by the Israeli Minister of Finance, which provide the conditions for doing so. We believe that
we meet and will continue to meet, the necessary conditions and as such, we measure our results for tax purposes based on the U. S. dollar/NIS
exchange rate as of December 31st of each year.

Law for the Encouragement of Capital Investments, 1959

The Law for Encouragement of Capital Investments, 1959 (the “ Investment
Law”) provides tax benefits for income of Israeli companies meeting certain requirements and criteria. The Investment Law has undergone
certain amendments and reforms in recent years.

The Israeli parliament enacted a reform to the Investment Law,
effective January 2011 (the “2011 Amendment”). The reform introduced new benefits for “ Preferred Enterprises”
instead of the benefits granted in accordance with the provisions of the Investment Law in effect prior to the 2011 Amendment. However,
companies entitled to benefits under the Investment Law in effect up to January 1, 2011, which were referred to as an Approved Enterprise
and Benefited Enterprise, were entitled to choose to continue to enjoy such benefits, provided that certain conditions were met, or elect
instead, irrevocably, to forego such benefits and elect the benefits of the Preferred Enterprise. The 2017 Amendment introduced new benefits
for Technological Enterprises, alongside the existing Preferred Enterprise tax benefits. According to the 2011 Amendment, a flat rate
tax applies to companies eligible for the Preferred Enterprise status. In order to be eligible for Preferred Enterprise status, a company
must meet minimum requirements to establish that it contributes to the country’s economic growth and is a competitive factor for
the Gross Domestic Product (a competitive enterprise).

We elected