Italy proposes higher PREU rates and a 20% rate for qualifying new AWP machines
Regulation2 min read
In brief
- Italy's 2027 budget bill proposes PREU of 25% for AWP machines and 9.6% for VLTs.
- AWP machines with at least 70% pay-out would be taxed at 20% from 1 January 2027.
- The technical report estimates extra revenue of €334m in 2027 and €456m from 2029.
The technical report to Italy's 2027 budget law puts the additional revenue expected in the first year at €334m, rising to €456m from 2029. The measure would raise the PREU rate for AWP machines from 24% to 25% and for VLTs from 8.6% to 9.6%.
From 1 January 2027, a reduced tax rate could apply to AWP machines, pending their replacement with machines that allow play only in a remote environment. For machines programmed with a pay-out of at least 70%, the PREU would be set at 20% instead of the new ordinary rate of 25%. The provision would also double the maximum cost of a single game from €1 to €2 and raise the maximum win from €100 to €200.
The technical report stresses that producing, certifying and putting the new devices into service will take time. The baseline is the AWP estate in operation in 2025, put at roughly 230mila machines. For 2027, take-up of the new configuration is projected at around 10% of AWP, equal to 23mila machines. For 2028 the projection is around 30%, equal to 69mila machines. From 2029 the projection covers the whole AWP estate.
The Government assumes that a pay-out increase of at least five percentage points, together with higher stake and win limits, would raise AWP collection by 30% against current legislation for the machines concerned. Without intervention, it forecasts AWP collection falling from 14.583bn in 2027 to 12.917bn at full operation. Under the new rules, estimated collection would reach 16.792bn from 2029. Even with the 20% rate for the machines concerned, the report projects PREU revenue 160m higher in 2027, 179m higher in 2028 and 258m higher at full operation than without the measure.
No comparable tax incentive is introduced for VLTs, and their collection is kept unchanged from the forecasts made without the measure. The report estimates that the VLT rate increase would produce additional revenue of 174m in 2027 and 186m in 2028, reaching 198m at full operation.
According to the technical report, the two measures combined would improve the state budget by €334m in 2027, 365m in 2028 and 456m at full operation from 2029. The report also indicates total PREU revenue from AWP and VLTs of 5bn in 2027, 4.9bn in 2028 and 4.8bn in 2029.