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Italy Enters the New Year 2019 with Higher Taxes on Gambling

January 7, 2019
3 Min Read
Italian gambling

The New Year 2019 doesn’t come with good news for the Italian gambling sector as the gambling taxes increase manifold and gambling advertising experiences a fresh blanket ban.

The newly passed budget in Italy will impose higher gambling taxes in the country this year. The news of the taxes surfaced over the weekend. The populist Italian government passed the budget at the last minute this past Saturday, following a deal with the European Commission. The original budget draft which aimed to cut Italy’ deficit to 2.4% of the GDP was rejected by Brussels earlier. The government redrafted a new budget that will set an even ambitious target of deficit limited to 2.04% of the GDP. The budget was quickly swept through the parliament, winning a vote of confidence in the Chamber of Deputies very comfortably.

The gambling sector will, unfortunately, be handled the shorter end of the stick. The new tax rates will be effective on January 1. On the same day, the much-criticized gambling ad blanket ban will also come into effect. All gambling companies licensed to operate in the country will bear the burden of increased taxes. Online casino operators will now give away 25% of their gross gambling revenue to the government. They earlier paid only 20% of their gross revenue. The move will add an extra 50 million euros to Italy’s coffers, as estimated by the lawmakers.

Online sports betting operations will be taxed at 24% instead of 22%. Retail betting operators will pay a 20% tax, up by 2% from their previous rate. This betting tax increase will add another 30 million euros to the country’s revenue. The Italian gambling sector has expressed its “utmost concern” about the impact of the new tax rate on the industry. They believe that the increased taxation will provide an undue advantage to the unlicensed casinos and betting operators in the country.

Moreno Marasco, Logico President, spoke to a local news outlet Agimeg earlier this month, noting that the licensed gambling sector is particularly vulnerable in Italy and it risks getting overshadowed by the black market operators. Logico represents the licensed gambling companies in the country, and according to Marasco, the new tax rate will not bring additional revenue to the country’s coffers. He suggests that the move could decrease the guaranteed tax revenue received by the state as the companies will not be able to work on acquiring customers by offering lucrative offers.

The blanket ban on gambling advertising is another cause of concern for the industry. The ban was championed by Deputy Premier Luigi Di Maio, one of the fountainheads of Italy’s populist government’s power. It was through his political prowess that the country’s swiftly moved to ban gambling adverts despite disapproval from the operators.

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