Italy has risen taxes on online gaming starting with the new year.
Online gaming license holders in the country face a 25 percent tax on gross gaming revenue on online casino and bingo—a 5 percent increase. Also, the online fixed-odds betting tax increased from 22 percent to 24 percent of gross gaming revenue.
Land-based sports betting operators saw a 2 percent increase to 20 percent of gross gaming revenue. Virtual sports also saw a 2 percent increase to 22 percent.
The country is also increasing taxes paid on amusement with prizes machines and video lottery terminals. The AWP tax rate has risen by 1.35 percentage points to 18.85 percent while VLTs will be taxed on 6.75 percent of revenue following a 1.25 percentage point rise. Payout rates have also been amended for these land-based machines, with AWP payouts reduced to 68 percent of stakes, and 84 percent for VLTs, according to reports at iGaming Business.
The taxes were passed as part of Italy’s 2019 budget, which seeks to reduce the country’s spending deficit.
The European Commission—which had originally rejected the budget proposal—has accepted Italy’s revised budget.
The hikes are expected to impact online gambling companies in the market. Playtech has already said that it is likely to see its adjusted earnings before interest, tax, depreciation and amortization for 2019 decline by up to €25m as a result, according to the report.
Further, the tax hike comes as the country is introducing a ban on all gambling advertising. Called the “Dignity Decree,” Italy has banned gambling operators from promoting their services through advertising and sponsorship agreements. While existing sponsorship deals will be allowed to run their course, operators will be blocked from renewing the partnerships, iGaming Business reported.
