Online Gambling and Italian Digital Services Tax – Clarifications on how to determine revenues

With Ruling No. 6 of 3 June 2025, the Italian Tax Authority provided important clarification on determining taxable revenues for digital services tax (Digital Services Tax, or DST) purposes for operators in the online betting and gambling sector. Among the most significant aspects, we note the exclusion of bonuses granted to players from the calculation of the DST tax base.

Below is an article on the topic from my Italian tax colleagues Giovanni Iaselli and Mario Russo.

Before examining the clarifications introduced by the interpretative ruling, it should be noted that the digital services tax – governed by Article 1, paragraphs 35 to 50, of Law No. 145/2018, as subsequently amended – applies at a rate of 3% to revenues deriving from specific services provided in Italy, namely:

• the provision of digital interfaces for the delivery of targeted advertising messages based on the analysis of data collected during users’ browsing (Article 1, paragraph 37, letter a), Law No. 145/2018);
• the management of multilateral digital interfaces that enable interaction between users and the sale of goods and services between them (Article 1, paragraph 37, letter b), Law No. 145/2018);
• the transmission to third parties of data generated by users’ activities on digital platforms (Art. 1, paragraph 37, letter c), Law No. 145/2018).

In its original wording, the DST applied only to entities which, individually or as a group, simultaneously achieved:

1. global revenues of at least €750 million;
2. revenues from digital services in Italy of at least €5.5 million.

However, as of 1 January 2025, pursuant to the provisions of Article 1, paragraph 21, of Law No. 207/2024 (2025 Budget Law), requirement (ii) has been repealed. Consequently, the DST now applies to all entities providing the above-mentioned digital services in Italy, provided that their global revenues – including at group level – exceed the threshold of EUR 750 million.

With specific reference to the online betting and gambling sector, Circular No. 3/E of 2021 (which provides general guidelines for the application of the Italian digital tax) had already clarified that, although the sums represented by “bets” are excluded from the scope of the tax, for the purposes of applying the DST, it is important to draw a distinction based on the role of the gaming platform operator:

• ‘Where the entity operates as a bookmaker (i.e., as an entity that accepts bets from players by setting odds, such as in the case of sports or other event betting) or a banker (i.e. as an entity against which players bet, such as in the case of online poker or roulette), the entity assumes risks on its own account and the proceeds are therefore excluded under Art. 37-bis, lett. b)’;
• “where it operates as an entity that allows players (users) to bet or gamble against each other, the entity does not bear any risk associated with the betting or gaming, but acts as an intermediary Although the sums represented by ‘wagers’ are excluded under subparagraph 37(a) or (b), the interface operator ‘commission is instead digital revenue within the meaning of subparagraph 37(b), realised as an intermediary in transactions between users.”

Interpretative Ruling No. 6/2025 confirms this approach and provides useful operational guidance on determining the revenues from Italian digital services provided in Italy that constitute the taxable base for DST purposes for gambling operators. In particular, the tax shall apply exclusively to the portion actually retained by the operator, i.e. the amount remaining after deducting the prize money paid to players and any single tax on gambling from the payments made by users. This criterion also applies where, in a single tournament, the winnings distributed exceed the bets collected, confirming that the taxable base coincides with the actual margin retained by the platform, which varies according to the type of game and the specific contractual conditions. Incidentally, reference is made to “tournament” as the game mode that falls within the scope of the DST, as it is clear that the role played by the platform managed by the concessionaire is to allow users to play against each other in return for remuneration in the form of a commission.

Particular attention is paid to the treatment of bonuses granted to players (e.g., welcome bonuses, free plays). As these amounts are granted free of charge and without consideration, they do not generate actual revenue for the operator and must therefore be excluded from the calculation of the taxable base for DST purposes. It follows that, in determining the commission subject to tax, the gross gaming revenue must be adjusted by subtracting the value of any bonuses paid. The dual track system for bonuses under the DST and the single tax on gaming is clear: while the document in question clarifies that bonuses do not contribute to the taxable base for the DST, the same does not apply for gaming tax purposes. In fact, as clarified by the provision of 10 June 2011 (Prot. 2011/20659/Giochi/GAD), bonuses are generally included in the collection.

In light of these clarifications, gambling operators who, in previous tax periods, falling within the scope of application of the Italian digital tax, included the bonuses granted to users in the calculation of the taxable base, or adopted criteria that differed from the approach outlined by the Italian Tax Authority, may have made an excessive payment. In such cases, it will be necessary to assess, on a case-by-case basis, the most appropriate methods for recovering the excess amount paid.

If you need legal support or advice on any issues related to Italian gambling tax, I will be glad to introduce you to my colleagues Giovanni Iaselli and Mario Russo. Also, you can have an outline on the Italian gambling law regime in DLA Piper’s Gambling Laws of the World Guide available HERE and access further gambling law news HERE.