Italy’s ADM Reports Decline in Gambling Tax Revenues for 2024 Amid Regulatory Changes

The Customs and Monopolies Agency (ADM) of Italy has reported a decrease in tax revenues from gambling operations for 2024. According to ADM’s latest Statistical Bulletin, the agency collected €8.05 billion in gambling taxes as of September 30, 2024. This marks a 6% decline compared to the €8.2 billion collected during the same period in 2023. ADM had gathered a total of €11.62 billion in gambling taxes for the entirety of 2023. If the current trend persists, 2024 could be the first year—excluding the pandemic-disrupted 2020—where ADM experiences a drop in gambling tax revenues.

The bulletin highlighted a significant downturn in the third quarter of 2024, with gambling tax revenues plunging by 16% to €2.22 billion. This was a sharp contrast to the €3.3 billion reported during Q3 2023. ADM attributed the decline to a substantial 26% year-on-year drop in net gambling expenditure, which fell from €5.9 billion in Q3 2023 to €4.35 billion in Q3 2024.

Despite the challenges faced in the gambling sector, ADM noted that the tobacco industry delivered strong performance. Tobacco tax revenues reached €4.18 billion in Q3 2024, representing a 5.77% increase compared to the same quarter of the previous year.

Within the gambling sector, gaming machines continued to be the most significant contributor, generating €910 million, which accounted for 41% of the net expenditure of €1.26 billion. Lotteries and number games followed closely, bringing in €870 million, equivalent to 39.08% of the sector’s total. Betting activities contributed €180 million, making up 8.17%, while other gambling products accounted for €260 million, or 11.64%.

On November 18, 2024, ADM introduced a comprehensive new licensing scheme for online gambling concessions. This marks the most significant overhaul in Italian online gambling regulation since its inception in 2011. Under the new framework, licences will be valid for nine years and will cost €7 million each. Additionally, licensees will be required to pay an annual fee of 3% on gross gaming revenue (GGR), excluding taxes and winnings.

As part of the changes, ADM extended existing licences by one year to ensure their validity through December 31, 2024, in accordance with provisions outlined in Budget 2024. The updated rules impose restrictions on operators, mandating that they offer “one app per gambling product type and one website.” Strict penalties have also been introduced for operators who use skin websites to promote branded products.

ADM anticipates that approximately 50 operators will apply for the new licences, which could generate €350 million in concession fees alone. Furthermore, the fixed annual licence fees are projected to contribute an additional €100 million annually.

The recent developments signify a pivotal shift in Italy’s gambling industry. While the sector grapples with declining revenues, the regulatory overhaul underscores ADM’s commitment to restructuring and modernizing its approach to gambling operations in the country.

By fLEXI tEAM