Company: PERI
Filing Date: 2025-03-25
Form Type: 20-F
Source: 0001178913-25-001021
Chunk: 73

Company: Perion Network Ltd.
Filing Date: 2025-03-25
Form: 20-F
Item: Item 5
Chunk 73
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 the Preferred Enterprise status commencing in 2011 and
one of our Israeli subsidiaries became a Preferred Enterprise in 2017.

73

We believe that the Company and certain of its Israeli subsidiaries,
qualify as a Preferred Technology Enterprise in 2024 and therefore, the portion of the income derived from Preferred Technology Income,
as defined in the Investment Law, which qualifies for the benefits, is subject to a lower tax rate of 12% according to Amendment 73 to
the Law, as described below.

Benefits granted to a Preferred Enterprise’s Preferred Income
include reduced tax rates. In peripheral regions (Development Area A) the reduced tax rate was 7.5%. In other regions the tax rate was
16%. Preferred Enterprises in peripheral regions will be eligible for grants from the Israeli Authority for Investments and Development
of the Industry and Economy (the “ Investment Center”), as well as the applicable reduced tax rates.

A dividend distribution from a Preferred Enterprise out of the
“ Preferred Income” would be generally subject to 20% withholding tax (in the case of non-Israeli shareholders - subject to
the receipt in advance of a valid certificate from the Israel Tax Authority ("ITA") allowing for such reduced 20% withholding tax rate,
or such lower rate as may be provided under an applicable double tax treaty). Dividend distributions out of “ Preferred Income”
to an Israeli company, are not subject to withholding tax (although, if such dividends are subsequently distributed to individuals or
a non-Israeli company the aforesaid will apply).

In December 2016, the Economic Efficiency Law (Legislative Amendments
for Applying the Economic Policy for the 2017 and 2018 Budget Years), 2016, which includes Amendment 73 to the Investment Law, was published.
Amendment 73 prescribed special tax tracks for technological enterprises as described below, and is in addition to the other existing
tax beneficial programs under the Investment Law. On June 30, 2021, certain grandfather rules in Amendment 73 pertaining the preferred
enterprises have expired, most significantly the limitation of Preferred Income to exclude such which is generated by intangible assets
not related to the manufacturing or such that would not have been recognized as Preferred Technology Income.

Tax benefits under Amendment 73 that became effective on January
1, 2017.

Amendment 73 provides tax benefits for two types of “ Technology
Enterprises”, as described below, and is in addition to the other existing tax beneficial programs under the Investment Law.

Amendment