Legal gambling: the urgent need for reform. “Without new rules, uncertainty, illegal gambling and risks to tax revenue will increase”

The Italian regulated gambling market remains one of the largest in Europe, generating €21.6 billion in GGR in 2025 and €11.5 billion in tax revenue. However, the land-based sector has operated for years under repeated extensions, fragmented local regulations, and expired or postponed concessions. Following the reform of online gambling, attention has now shifted to the retail network: without a comprehensive regulatory framework, there is a risk of weakening the legal market, encouraging illegal gambling, and undermining investment, employment, and tax revenue.

The reform of regulated gambling is no longer merely a technical issue, nor is it a sector-specific matter confined to the relationship between the State, concessionaires, and the distribution network. It has become a key issue of industrial, fiscal, and law-enforcement policy. Over the years, Italy’s legal gambling market has grown into one of the largest in Europe, generating stable revenue for the State while also acting as a safeguard against illegal gambling. Yet this very function could be weakened if the reform of the land-based sector were postponed once again.

The figures illustrate the scale of the issue. In 2025, GGR—the amount effectively spent by players after winnings have been deducted—reached €21.6 billion. This is the most accurate indicator for measuring the market, as it distinguishes total stakes from the sums actually retained by the system and subsequently divided between taxation and the industry’s operators. In the same year, the sector generated €11.5 billion in tax revenue, equal to 1.8% of the State’s total tax receipts. It is therefore far from a marginal item, but rather a stable source of public revenue over time.

The market, however, has evolved more rapidly than the rules governing it. Online gambling continues to grow: in 2025, digital-channel GGR increased by 11% compared with the previous year, while retail remained broadly stable, recording a slight decline of 2%. These figures confirm that the sector is not contracting but transforming: the balance between channels is shifting, as are demand, technology, and the ways in which consumers access gambling products.

Land-based gambling: from one extension to the next

The problem is that this evolution coexists with a regulatory framework which, particularly for the land-based network, remains rooted in a system created during a different historical period. Following an initial centralisation of rules and concession management, the sector has seen a growing accumulation of regional laws and municipal regulations over the past ten years. These measures are often motivated by public-health concerns but have been adopted unevenly across the country, particularly regarding minimum distances from sensitive locations and restrictions on opening hours. The result is a fragmented regulatory map in which national rules have gradually been supplemented, overridden, or made more complex by differing local provisions.

This fragmentation does not merely create uncertainty for operators. It directly affects the ability to plan the network and launch new tenders. Without a clear national framework, it becomes difficult to determine where and how the legal regulated gambling network may operate.

This has led to the now systematic use of extensions. In the absence of a comprehensive reform, lawmakers have been forced for years to keep the system operating through successive postponements. Betting and bingo concessions have been extended for more than ten years, while the gaming-machine concession expired in 2022. The 2023 Budget Law aligned the extension regime for the main categories of retail gambling until 31 December 2024; the 2025 Budget Law subsequently extended them until 31 December 2026. This solution has ensured continuity of the public service, but it cannot become a permanent arrangement.

Uncertainty means lost investment—or investment diverted elsewhere

According to AGIC, it is precisely this imbalance that makes reform urgent. Land-based gambling continues to account for the largest share of the market: in 2025, it generated approximately €16 billion in GGR, compared with €5.6 billion for online gambling. It is not a remnant of the past, but still a central part of the system. The retail network includes betting, amusement with prizes (AWP) and video lottery terminals (VLT), bingo, retail outlets, and operators distributed throughout the country. According to AGIC—the association representing Brightstar Lottery, Eurobet, Lottomatica, Flutter Southern Europe & Africa and, as an associate member, bet365—the sector accounts for around 7,000 direct employees and an overall network of approximately 70,000 retail outlets, in addition to thousands more jobs in related industries.

A further postponement would leave this infrastructure in a state of regulatory uncertainty. This uncertainty affects businesses, the retail network, investment, and the State’s ability to govern the market. The companies operating in the sector are now listed multinationals competing not only within the industry but also among the different countries in which they operate. Put simply, if Italy continues without new concessions and relies instead on six- or twelve-month extensions—making medium- and long-term investment planning impossible—companies will choose to invest in countries offering greater regulatory certainty.

The contrast with remote gambling is clear. As part of the delegation to the Ministry of Economy and Finance, the Government has already approved Legislative Decree No. 41 of 25 March 2024, which reorganised the regulation of online gambling. In 2025, a tender was held for new remote gambling concessions, attracting 52 operators and requiring a payment of €7 million per concession. The new online concessions became operational on 13 May 2026. The digital sector has therefore entered a new regulatory phase, while the land-based network remains on hold.

One of the main issues is the so-called “distance rule”. Introduced differently by individual Regions, it was intended to protect more vulnerable people and reduce the risk of problem gambling. However, the inconsistent application of minimum-distance requirements has not produced positive results in combating gambling addiction. Instead, it has contributed to the closure of retail outlets and shifted legal gambling away from town and city centres towards outlying areas. This shift may affect public safety, employment levels, and tax revenue, while also making the authorised network less visible and more difficult to monitor.

The issue is a delicate one: effective regulation does not necessarily mean more restrictive regulation. If the rules make the legal market less accessible, less competitive, or less capable of meeting demand, some consumers may move towards illegal operators. This is where delays to the reform become a public risk. The illegal market pays no taxes, does not comply with identification requirements, does not implement prevention measures, does not protect minors, does not monitor compulsive behaviour, and can offer higher payout rates precisely because it does not bear the tax and compliance costs faced by the regulated market.

The illegal market is worth €4 billion a year

Research by MDF Partners identifies the competitiveness of the regulated market as the first line of defence against illegal gambling. According to a Federconsumatori estimate cited in the study, the so-called “black hole” of illegal gambling is worth approximately €4 billion. Illegal operators can offer a wider range of products, more aggressive odds, higher payout rates, flexible payment systems—including cryptocurrencies—a perceived greater level of discretion, and marketing channels that often rely on social media and streaming websites. These channels are difficult for legal operators to compete with, partly because of advertising restrictions.

The paradox is clear: the more the regulated market is restricted or left in uncertainty, the more competitive the illegal market may appear to some players.

At European level, the quality of regulation is one of the factors affecting channelisation—that is, the share of gambling expenditure captured by the legal market. The MDF Partners study shows that, where regulation succeeds in balancing the breadth of the legal offer, taxation, advertising rules, and responsible-gambling measures, the share of the market remaining within the legal system tends to increase.