According to data from the Italian Agenzia delle Dogane e dei Monopoli (ADM), online casinos saw a significant slowdown in their revenues in October, perhaps in part as a result of new changes coming to the law system regarding taxing punters’ winnings.
That’s not to say they experienced a loss, but the gain from last October was very small – a very small 1.2 % for a total of €65.7m – much less than anticipated.
How the Numbers Fared in October
It wasn’t just the small gain from last year that has experts worried; October’s revenue ended up being much lower than September’s (which closed at €71.8m). Overall, this is quite a decline and the first time in 2019 that the market has grown in the single digits percentage.
The same slump was felt in the sports betting market, where revenues went down 3.5 % and online betting in general has gone down 0.7% (with a whopping 7.6% for online poker). Retail wagering fell 5.8% compared to the previous month, a significant drop that points to a number of factors.
What’s Behind the Slowdown
In addition to potential law changes impacting revenue, there are other issues at play here, though it’s hard to tell which ones are causing the biggest impact and what can be done to turn that around. For example, Italy imposed specific and strict restrictions on gambling advertising last month.
The only section not hurting seems to be the government, as they actually saw an increase of 7.6% since last year, earning almost €12b so far in 2019. This is also about to change, as the new tax and gambling regulations could boost those earnings by an additional €700m next year. Much of this will come from an increase in taxes imposed on gambling winnings, including on areas that have been (up to now) immune from taxation. For example, video lottery winnings under €500 had never been taxed but will now be taxed at the rate of 1.9%. And in 2021, all winnings over €500 will be taxed 15%, up from the 12% currently charged to winners.
Experts are unsure of how these changes will affect gambling in the country, guessing that although the government will benefit from the higher taxes, the industry itself will continue to see a slowdown as new fees are introduced. In fact, it might take some time before things stabilize again and people feel ready to put their money into the industry again.
Gambling in Italy
Gambling has existed in Italy since the Roman Empire, where the oldest form of backgammon was already played. In fact, Roman legionnaires used to play Ludus duodecim scriptorum (strikingly similar to modern backgammon), though archeologists don’t have many details about the specific rules of the game. Both bingo and baccarat also originated in Italy in the 14th and 15th century.
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