The Italian Budget Law for 2019 has increased taxation on gambling. Many gambling products are significantly affected – whether offered offline or online. Starting from 1st January 2019, remote betting turned from 22 to 24% GGR, while offline betting from 18 to 20% GGR; remote bingo and skill games (“giochi di abilità”) taxation turned from 20 to 25% GGR. The ambiguity of remote casino and cash poker inclusion may lead to legal disputes. Virtual bets, both remote and offline, turned from 20 to 22% GGR. Taxation increased also for slot machines on the ground: video lotteries (VLTs) and amusement with prizes (low stake/low prize) machines (AWPs). This is the latest taxation increase for slot machines following several previous ones in a short period of time.
This taxation increase comes only a few months after the advertising and sponsoring blanket ban for gambling, voted last summer with the Dignity Decree, banning all such initiatives, including prize contests and the overlay of gambling logos, trademarks and tradenames, with the alleged aim to strengthen consumer protection and to enhance contrast to gambling addiction. Any violation is punished with heavy sanctions issued by the Italian Communications Regulatory Authority- Autorità per le Garanzie nelle Telecomunicazioni AGCOM. A temporary one-year exemption has been granted for those advertising agreements ongoing at the date of entry into force of the ban and for the ongoing sponsoring agreements, the latter according to AGCOM recent interpretation. Interestingly, in order to compensate the shortfall, the Dignity Decree had already significantly increased taxation for VLTs and AWPs until 2023. However, an economic justification of this nature is not permissible under EU laws.
But the Budget Law also provides for additional provisions concerning gambling. One of these is the prorogation of current offline licences for betting and bingo. The current licenses have expired since years already and the tenders are long time awaited, preventing any newcomer to enter these markets. For the same reason, the European Court of Justice had sanctioned Italy in 2006 for having prorogated a relevant number of horse betting licenses without launching any tender. So now, where from here?
Apparently, the Italian Government strategy for gambling has no “followers”.
That is not to say the gambling advertising and sponsoring ban has not been carefully examined. It has, but the other EU State members rather opted for a more strict advertising regulation instead of a total ban. United Kindgom and Belgium to name only a few.
Also, increase of gambling taxation seems totally in contrast with the strategy of other State members to correctly balance the applicable taxation.
Especially as regards online gambling, Italy was named in the past as a model of regulation and inspired many other EU countries. Isn’t’ this a model to be preserved rather than penalized?
