Betfair has won its Italian ‘tax reform’ appeal against Italy’s ADM customs and monopolies department over the application of a temporary 0.5 percent wagering tax to its Exchange website.
The TAR commercial disputes court in Rome ruled this week in favour of Betfair’s appeal that a 0.5 percent tax fee on Betfair’s Exchange operations as a licenced business incumbent could not be imposed.
The ADM was forced to extend a temporary 18-month 0.5 tax fee across all sports wagering verticals – retail, internet, and virtual sports – after Parliament approved Italy’s COVID Revival Decree.
Betfair immediately filed an appeal against the ADM’s decision, claiming that its Exchange will face total tax charges of 111 percent (corporate and wagering), rendering Italy a non-viable market for the company.
According to the Rome TAR judges….
The ADM had “failed to carry out an accurate analysis of how to determine the taxable amount/contribution to be paid in the context of betting exchanges and as to why the contribution should be payable by winning players,” according to the Rome TAR judges, who backed Betfair’s appeal.
The judges have ordered the ADM to correct passages of the Revival Decree, stating that a betting exchange exemption should be established – Betfair currently controls 96 percent of the Italian market.
According to the decision, the ADM must recalculate its temporary tax fee, taking into account specific factors to betting exchange calculations, in order to ensure that Italian betting businesses and services are treated fairly.
Betfair’s early legal challenges against the ADM had been overturned prior to the Rome verdict, prompting the firm to limit its Exchange services to high-wagering customers.
Betfair had previously requested that the ADM adjust the temporary tax fee to a 3 percent GGR tax rate on its earnings, or as an Exchange commission, rather than as a wagering charge, in previous appeals.
The temporary tax fee for betting exchange operators has been suspended for the time being, but it remains in effect for licenced Italian bookmakers.