Italy’s Betting Industry Fights Against Government Tax

Italy’s betting companies are fighting hard back against a government plan to introduce a new betting turnover tax to give a boost to struggling sport leagues.

Reports emerged last weekend that the Italian government was mulling a plan to impose a 0.75 percent tax on all sports betting turnover – land-based, online, and even on virtual sports – in the so-called Relaunch Decree aimed at getting Italy back up and running after the COVID-19 pandemic.

The proposed new tax would remain in effect until 31 December 2022, with the money allocated for a fund for football safety. Italy’s football leagues, who are struggling after being forced to suspend play before the country got a handle on its COVID-19 problem, had initially pressed for a turnover tax of 1 percent.

Yet during the pandemic, Italy’s betting operators were similarly unable to benefit, and land-based betting shops have yet to be permitted to open their doors to the public. (The government previously floated a timetable for retail gaming restarts, but this was binned shortly afterwards, leaving operators in the dark.)

Stefano Papalia, president of the Italian Federation of Legal Game Operators (FIEGL), said that struggling betting operators being forced to pay even more tax ‘risks bringing the betting sector at its knees.’ FIEGL National Coordinator Corrado Luca Bianca added that in the financial planning of the Government, the betting industry was “tired of being the ATM.”

Papalia further cautioned that many betting operators are now unsure whether they will reopen, thereby driving many of them over the edge with new taxes, with the net effect that the government would have fewer bookies to raise this new tax.

The government revised its draft law on Monday, lowering the sales tax to 0.3 percent, but maintaining that this year the sports fund would raise at least €40 million, and €50 million in each of the following two years. Previous drafts set those minimum sums at 20 million euro this year, 40 million euro in 2021 and 2022 million euro.

The Relaunch Decree’s early drafts also included proposals to modify the period of gaming concessions so that they all expired on 31 December 2022. This was to have been achieved by extending concessions that were due to expire by that deadline, with operators affected being forced to set up high monthly fees by the end of 2022.

Allegedly this concession language has been stripped of current draughts, but it goes without saying that Italy’s licenced gambling operators lie awake every night wondering what fresh risks will emerge the next day.