Italian budget proposes higher AWP and VLT taxes as industry column urges tax-base reform
Regulation2 min read
Italy’s 2027 budget proposal would raise PREU rates for traditional AWP machines to 25% and VLTs to 9.6%, while setting a 20% rate for updated AWP machines, the source says. An Italian gambling-industry commentary argues instead for taxing the difference between stakes and winnings, proposing rates of 66.67% for AWP and 56.47% for VLT machines.
Italy’s proposed 2027 budget would raise taxes on traditional AWP machines and VLTs, while an opinion column on an Italian gambling industry site argued for changing the tax base instead. The proposal would raise PREU to 25% for traditional AWPs and from 8.6% to 9.6% for VLTs, with no offsetting relief for VLTs.
For updated AWPs, the proposal would lower PREU to 20%, raise payout to 70% and double stake and prize limits, with the aim of increasing the amount wagered by 30%. Preliminary reconstructions of ADM data indicated that total machine wagers fell by nearly 2% in the first half of 2026 from the same period in 2025.
The budget’s technical report estimates that the VLT increase would yield an additional €174m in 2027, €186m in 2028 and €198m from 2029, assuming wagers remain unchanged from the scenario without the measure.
The column proposed taxing the difference between stakes and winnings, before operating costs, at 66.67% for AWPs and 56.47% for VLTs instead of taxing stakes. The columnist said those rates would match the budget’s tax yield only if payout remained at 70% for AWPs and 83% for VLTs, respectively, and wagers stayed unchanged. At higher payout rates, tax revenue per euro wagered would fall unless higher volumes offset the difference, the columnist said.
By the columnist’s calculation, renewing about 230,000 AWPs would cost at least €460m, based on a minimum €2,000 per machine for a board change, administrative charges, logistics and technical work. The columnist said operators would face that cost while concessions were under extension and the period available to recover their investment remained uncertain. The columnist calculated that, for a machine taking €100,000 in annual wagers, a 2% market contraction followed by 30% growth from an upgrade would raise annual gross margin from €11,000 to €12,740. The €1,740 annual increase would theoretically recover the €2,000 investment in about 14 months before additional costs, while 15% growth in wagers would mean a payback period of more than seven years, the columnist calculated.