Apr12
Italy Increases Tax for Gambling Operators in 2019
January 3, 2019 Alex Hoffmann
The new year has instigated a series of changes in the Italian iGaming industry, as the state government officially increased tax for gambling operators and brought a ban on advertising into action, effective January 1st, 2019.
According to the new law, online casino licensees in the country will have to pay a tax of 25% of gross gaming revenue while land-based sportsbooks will be subject to 20 percent GGR tax. To summarize, online bingo tariff will be raised for 5% while fixed-odds wagering will be magnified to 24% from previous 22%.
Tax boost covers even virtual sports, which are now subject to 22 per cent gross revenue levy… the vertical was previously taxed 20% of GGR.
The regulator’s monthly report for November revealed proceeds of €148.5 million, an improvement of nearly 15 million EUR in just one month.
Payout Rates Also Amended
Increased taxes have even affected payments on amusement with prizes machines as well as vide lottery terminals. However, the authorities have imposed only a slight increment on AWPs, raising the toll by 1.35 percent or 18.85% with VLTs now being taxed 6.75 percentage points in total, which is a 1.25% rise.
The country has decided to reduce AWP payouts to 68% of stakes, while VLT land-based machines embraced an 84% reduction. New tax rates represent only a small part of Italy’s budget for 2019, including “broad spending plans until 2021.” The state is also aiming to reduce deficit to 2.04% of Gross Domestic Product, although its original target was set to 2.4%, perhaps a bit high at the time.
Tax Hikes to Impact Operators and Providers
To make things official, Italy’s budget proposal needed to be accepted by the European Commission. As soon as the country’s coalition government presented a revised version at the end of 2018, the Italian Senate and Chamber of Deputies approved the bill.
If it’s to judge by Playtech’s statement that the company will “likely see its adjusted earnings before interest, tax, depreciation and amortization for 2019 decline by up to €25m as a result” it remains rather blurry, at least at this moment, whether the newly imposed taxes will impact operators’ profits.
In addition, the market has suffered a so-called “blanket ban” on advertising, since the country’s Dignity Decree bans operators from promoting or broadcasting betting services as well as sponsorships. Existing arrangements with clubs will be allowed until the contract expiry dates, since the law blocks operators from renewing partnerships or making any further sponsorship deals.
Source:
“Italy begins 2019 with gambling tax hike”, igamingbusiness.com, January 2, 2019.
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