5 Major Developments in Italy

5 Major Developments in Italy

• Publishes Legislative Decree for Implementation of DAC7

• Tax truce, penal shield and the new timing

• Italy Lowers VAT and Allows Tax Credits to Offset Energy Costs

• Ruling 287: VAT rate of 4% for cardiovascular prostheses

• Circular: No VAT on supplies to armed forces

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Bad Debts (Relief for Underpaid Sales Invoices)

• Ruling 32: Invoice regularization: how to recover VAT

Composite Supply

• Ruling 239: VAT rate of 5% if the thermal energy is supplied with the «energy service» contract

• ECJ C-250/22 (Fallimento Villa di Campo Srl) – Order – TOGC artificially broken down into a number of different supplies

• Authorities: Principle of VAT accessories does not apply when the accessory service is provided by a third party

• Ruling 36: Ancillary link between transportation service and the transaction main supply of goods

• Ruling 12: Services of accessing online journals and databases and publishing of articles rendered to non-taxable customers

Cryptocurrency and NFT

• Italy exempt Cryptoassets mining and utility tokens for funding offers from VAT

• Tax Authorities Clarify VAT Treatment of Cryptoasset Mining Activities

DAC7

• Publishes Legislative Decree for Implementation of DAC7

• Italy Gazettes Legislative Decree Implementing DAC7

• Italy Approves Legislative Decree for Implementation of DAC7

Deduction (Input Tax Credit)

• VAT deduction on transaction costs in merger leveraged buyout transactions

• Depreciable goods and pro-rata VAT for exempt operations

• News of the 2023 VAT return and the use of the 2022 credit

• Ruling 203: Misapplication of reverse charge – recovery of non-deducted VAT

• Ruling 182: Supply of the medicine at the symbolic price of 1 euro

• Supreme Court: Import VAT could be deducted despite late identification

• Transfer for export, theft and VAT reflexes

• Ruling 136: “Chain” exports with application of frequent exporter rules

• Ruling 83: Occasional exempt supply does not impact pro rata and place of supply tourist package

• Ruling 25: Adjustment of deduction – Article 19-bis2, paragraphs 1 and 2, of Presidential Decree no. 633

• Ruling 32: Recovery of VAT paid following regularization of the invoice

• VAT deduction for the foundation carrying out commercial activities

• The responsibility of the transferee in the event of incorrect application of the VAT rate on the invoice

Digital Services Tax

• This Month in Indirect Tax: VAT Rulings on NewsCorp and OnlyFans

• Italy assess Facebook for VAT on users’ data in return for ‘free’ portal access

E-Commerce / Electronic Services

• The foreign Country of identification determines whether the OSS can be used to pay Italian VAT on transactions carried out before the date of adhesion to this regime

• New rules for e-commerce according to the new Consumer Code in Italy

• Online language courses subject to VAT in the country of recipient

• Ruling 77: IOSS rules for platforms – intrinsic value and identification of supplier

• Ruling 74: Applicability of the IOSS regime to sales made under ”drop shipping” to flat-rate customers and regular business customers

• “One Stop Shop” regime, simpler VAT obligations

• Ruling 58: OSS scheme – Irish entity performs intra EU B2C sales – Italian 3rd party arranges pick and pack

• Tax Authorities Clarify VAT Treatment of Online Games Activities

E-invoicing

• E-Invoicing in Italy, France and Poland – A quick comparison

• E-Invoicing: discover the benefits of automation

• E-invoices: sending beyond the deadlines can be remedied

• What is the scope of mandatory e-invoicing in Italy?

• How does E-Invoicing work in Italy?

• Electronic Invoicing in Italy: White paper (2021)

• E-invoicing Italy: All you need to know

ECJ (European Court of Justice)

• ECJ C-37/23 (Giocevi) – Question – 2009 earthquake – Refund of tax at the rate of 60%

• Leaseback is not always a transfer of goods for VAT purposes

• New ECJ VAT Case – C-37/23 (Giocevi) – Questions not yet released

• ECJ C-250/22 (Fallimento Villa di Campo Srl) – Order – TOGC artificially broken down into a number of different supplies

• Indirect customs representative not responsible for import VAT

Environmental Tax

• General Look to Plastic Tax Regulation

• 2023 budget law enacted, including certain measures relevant to multinational groups

• 2023 Budget Law – New provisions in the VAT, excise duties and consumption tax field

Excise

• The EU Principles Inspire the Italian Excise Tax Reform

• Italy eyes cut in excise duties as anger grows over fuel prices

Exemption

• Circular: No VAT on supplies to armed forces

• Non-taxable VAT goods and services for the armed forces

• Ruling 279: VAT exemption educational services- art. 10, first paragraph, no. 20

• Ruling 269: Pension funds – Outsourcing of core functions

• Ruling 254: VAT treatment of routine maintenance work to be performed on vessel under temporary importation

• Council implementing decision to allow Italy to exempt taxable persons with a turnover below EUR 85k

• Italy: European Council approves proposal authorizing increase of VAT exemption threshold

• Proposed Council Implementing Decision Authorizing Italy to Increase VAT Exemption Threshold

• Ruling 217: Waiver of claim for the purpose of exemption from the submission of the guarantee

• Depreciable goods and pro-rata VAT for exempt operations

• Ruling 207: Management of ATMs – Treatment for VAT purposes

• Is the extension of the legal warranty of conformity always exempt for VAT purposes?

• Transactions that count for the frequent exporter threshold

• VAT non-taxability of international transport: application uncertainties and possible solutions

• Ruling 188: VAT exemption for cash service provided to a subject subject to the SIOPE

• Ruling 179: VAT exemption for mutual fund management services

• What happens if the goods to be exported are stolen?

• Circular 2: VAT on international transport services (C-288/16)

• Ruling 131: Playrooms and early childhood services

• Ruling 95: Frequent exporter scheme by non-residents

• Ruling 40: Frequent exporter rules – installation of plant

• Ruling 11: VAT exemption for fundraising services rendered to the SGR

• Management services of mutual funds provided by the Advisor to the SGR, VAT exemption

Export

• Ruling 283: VAT -Triangular export supplies – art. 8, paragraph 1, lett. a)

• Returns of defective goods: VAT and customs

• Transactions that count for the frequent exporter threshold
• What happens if the goods to be exported are stolen?
• Ruling 136: “Chain” exports with application of frequent exporter rules
• Ruling 95: Frequent exporter scheme by non-residents

Fiscal Representation

• Ruling 114: Sale of goods to a VAT warehouse by a non-resident with a tax representative

Fiscalization

• Technical specifications for electronic storage and the telematic transmission of the fee data

• There is a deadline for an adjustment for cash register manufacturers in Italy

Fixed Establishment

• Involvement of a fixed establishment in the intra-Community supply of goods

• Intervention of the permanent establishment in the context of an intra-community transaction

• Fixed Establishments: unexpected potential VAT liabilities from Intra-Community transactions

• Ruling 57: Supply German vendor involving its Italian fixed establishment, who is liable to pay VAT

Flat Rate Schemes

• Extending 15% flat tax rate to VAT payers with revenues of up to 85,000 euros (US$89,713)

Fraud / Tax Evasion

• Italy: EPPO to seize €149 million in investigation into VAT fraud on fuels

• EPPO: Operation in Italy against criminal group under investigation for massive VAT fraud: 12 arrests, including four public officials

• Italy assess Facebook for VAT on users’ data in return for ‘free’ portal access

• Italy is investigating parent company Facebook (META) for tax evasion

• Italy pursues Facebook-owner Meta for $925 million in VAT

• EPPO uncovers €40 million VAT fraud: six arrests and seizures in sting against organised crime

• Italian VAT investigation into Booking expanded

• Investigation into VAT fraud Booking.com further expanded

• Fraud concerning agricultural funds and VAT payments in Sicily – preventive seizure order of over €7 million

Importation

• The date on which the accounting report is generated drives the deadline for deduction of import VAT

• Returns of defective goods: VAT and customs

• Payment of VAT at Customs for advances on imported goods

• Supreme Court: Import VAT could be deducted despite late identification
• Ruling 77: IOSS rules for platforms – intrinsic value and identification of supplier

• Ruling 74: Applicability of the IOSS regime to sales made under ”drop shipping” to flat-rate customers and regular business customers

• Ruling 70: The transfer of rights incorporated in import licenses is subject to VAT

• Ruling 44: Tax point for imports made under a consignment stock contract – VATupdate

• Indirect customs representative not responsible for import VAT

Intra-Community Transactions

• Ruling 230: Intra-Community supplies – Communication of identification number VAT registered in the VIES file

• Involvement of a fixed establishment in the intra-Community supply of goods

Intrastat

• 2023 Budget Law – The main measures in national and international taxation

• European Union: Various Changes to Forms & Intrastat Thresholds

Invoice

• Ruling 275: Health care services for diagnosis, treatment and rehabilitation of the person – Obligation of documentation by invoice – Article 22

• Ruling 203: How to correct when an exempt or non-taxable transaction has been invoiced with VAT

• Ruling 114: Sale of goods to a VAT warehouse by a non-resident with a tax representative
• Ruling 32: Recovery of VAT paid following regularization of the invoice

• Ruling 31: Advisor Support Services provided without the payment of a consideration in cash

• Italian Receipt Lottery: Changes are Underway

• The responsibility of the transferee in the event of incorrect application of the VAT rate on the invoice

Legislative Change

• 2023 budget law VAT measures

Liability (Reverse Charge/Withholding)

• ECJ C-37/23 (Giocevi) – Question – 2009 earthquake – Refund of tax at the rate of 60%

• Definition of formal violations for reverse charge errors – with 200 euros all the violations committed during the year are remedied

• Ruling 203: Misapplication of reverse charge – recovery of non-deducted VAT
• Ruling 57: Supply German vendor involving its Italian fixed establishment, who is liable to pay VAT

OECD (Organisation for Economic Co-operation and Development)

• Electronic Invoicing in Italy: White paper (2021) – VATupdate

One Stop Shop

• The foreign Country of identification determines whether the OSS can be used to pay Italian VAT on transactions carried out before the date of adhesion to this regime
• “One Stop Shop” regime, simpler VAT obligations

Place of Supply

• Online language courses subject to VAT in the country of recipient
• Ruling 83: Occasional exempt supply does not impact pro rata and place of supply tourist package

• Ruling 27: Relevance for VAT purposes for electric vehicle charging

• Ruling 12: An online database can be an electronic service for VAT purposes

• Ruling 12: Services of accessing online journals and databases and publishing of articles rendered to non-taxable customers

Rate

• Ruling 287: VAT rate of 4% for cardiovascular prostheses

• This Month in Indirect Tax: 50 Years of UK VAT; E-Invoicing in Saudi Arabia; and NFTs

• Supreme Court: 10% VAT for the sale of the building intended for a health clinic

• Ruling 282: 4% rate for supplies of technical and computer aids to favor of handicapped persons

• Italy Lowers VAT and Allows Tax Credits to Offset Energy Costs

• Italy to consolidate VAT rates

• Ruling 257: VAT rate medical devices

• Circular: Reduced VAT rate for the sale of the photovoltaic system

• Court: 4% VAT for bread with soy flour

• Ruling 239: VAT rate of 5% if the thermal energy is supplied with the «energy service» contract
• Ruling 230: Intra-Community supplies – Communication of identification number VAT registered in the VIES file

• District heating with a VAT rate of 5% for the first quarter of 2023

• Transactions that count for the frequent exporter threshold
• 2023 Budget Law – New provisions in the VAT, excise duties and consumption tax field
• Circular 2: VAT on international transport services (C-288/16)
• Ruling 95: Frequent exporter scheme by non-residents

• Italy prolongs gas VAT cut to 5% until 31 March 2023

• Ruling 40: Frequent exporter rules – installation of plant
• Ruling 12: An online database can be an electronic service for VAT purposes
• Italy eyes cut in excise duties as anger grows over fuel prices

• Italy reduced the VAT rates on certain products in 2023

• 2023 budget law VAT measures

• Government studying reducing VAT on telecoms to 10%

• Ruling 9: Transport and home delivery of meals: VAT treatment

• The responsibility of the transferee in the event of incorrect application of the VAT rate on the invoice

• Ruling 6: Intermediation in the manufacture and supply of dental prostheses

• Ruling 7: VAT rate applicable to vegetable product on edible turf

• Reduced VAT Rates on Feminine Hygiene Products, Baby Products, and Face Masks from 1 January 2023

• Renewed and expanded reduced VAT rates in the energy sector

Real Estate/Immovable Property

• Supreme Court: 10% VAT for the sale of the building intended for a health clinic
• Circular: Reduced VAT rate for the sale of the photovoltaic system

• Italy VAT treatment of sale and lease back transactions

• Ruling 232: Relevance of failure to return the security deposit provided for in the lease agreement in implementation of settlement agreement

• Ruling 208: Merger between AIFs: when they are relevant for VAT purposes

• Ruling 218: Sale and lease back: new clarifications

• Ruling 69: Transfer of building rights, made by a company in favor of the owner of the neighboring area

Real Time Reporting/Continuous Transaction Controls

• No penalty for wrong “nature code” in XML

• E-invoices: sending beyond the deadlines can be remedied
• E-invoicing Italy: All you need to know

Refund

• The reimbursement for the innocent error in the VAT rate is admissible

• VAT refund in the case of late VAT registration

• Ruling 227: The warranty waiver for VAT refunds does not transfer with the business

• Ruling 220: Transfer of the VAT credit in the consolidation within the group

• Ruling 211: Refund – Declaration in lieu of affidavit

• No VAT refund for Canadians due to absence of the reciprocity condition

Registration

• VAT refund in the case of late VAT registration
• Ruling 230: Intra-Community supplies – Communication of identification number VAT registered in the VIES file
• Proposed Council Implementing Decision Authorizing Italy to Increase VAT Exemption Threshold

• Italy increases VAT registration threshold to €85,000

Reporting / Compliance

• It’s time for a VAT return: what’s new in the 2023 Model
• The reimbursement for the innocent error in the VAT rate is admissible

• Failure to pay VAT in any case inferable from the return

• Pre-filled Italian Annual VAT return – an innovative change

• OSS cannot be used to regularize the VAT debt of previous years

• Ruling 253: Clarification on how VAT relating to previous years is paid by a person not identified in Italy

• Italy Publishes English-Language Annual VAT Form for Filing in 2023 in Respect of 2022

• Tax Authorities Publish English Language Version of Annual VAT Return Form

• Changes in thresholds for VAT payments frequency in Italy

• More European countries implement ”Pre-Filled” VAT returns

• Increased VAT Thresholds for Reporting Purposes

• 7 VAT Country guides on Italy

• 50 years of VAT: Italy’s progress in the European harmonization process

• Italy announces pre-filled annual VAT returns for certain taxpayers

• 2023 Budget Law – The main measures in national and international taxation

• New thresholds for VAT payments’ frequency in Italy

• VAT Reporting: Form Changes in IT, ES, HU, HR

• Italy Launches Pre-Compiled VAT Returns for Quarterly VAT Payers

• Italy Releases First Pre-Filled Annual VAT Returns

• Pre-compiled declaration for 2.4 million VAT numbers

• Pre-Filled VAT Returns for Certain Taxpayers

• Ruling 208: Group VAT settlement also for non-resident companies identified in Italy

• News of the 2023 VAT return and the use of the 2022 credit

• Italy pre-filled VAT returns option

• The pre-compiled VAT return makes its debut

• The pre-compiled VAT return makes its debut

• Ruling 175: Free of charge chartering of a vessel by research institution

• Technical specifications electronic transmission of data in annual VAT return for the year 2022

• Italy Publishes Annual VAT Return Form for Filing in 2023 in Respect of 2022

• Ruling 58: OSS scheme – Irish entity performs intra EU B2C sales – Italian 3rd party arranges pick and pack

• Ruling 49: Transaction outside scope in the absence of the conditions for the application of the regime of ”call-off stock”

• Ruling 34: VAT treatment of the activity of selling access tickets to the LTZ

• VAT/2023 return models relating to the year 2022

• Ruling 23: Option for optional separation of activities

• Ruling 33: Relevance of amounts paid under settlement agreement

• Pilot extended: VAT pre-compiled also for agricultural producers and bankrupt subjects

• Principle of Law 1/2023: Obligation to issue VAT variance notes in case of a settlement agreement as part of a certified reorganization plan

SME (Small and Medium- Sized Enterprises)

• Council implementing decision to allow Italy to exempt taxable persons with a turnover below EUR 85k
• Italy increases VAT registration threshold to €85,000
• Proposal authorising Italy to apply a special measure derogating from Article 285 (relief to small undertakings)

Supply of Goods

• Ruling 27: Relevance for VAT purposes for electric vehicle charging

Supply of Services

• Ruling 27: Relevance for VAT purposes for electric vehicle charging

Tax Point (When the Chargeable Event Occurs)

• The date on which the accounting report is generated drives the deadline for deduction of import VAT
• Ruling 44: Tax point for imports made under a consignment stock contract – VATupdate

• Ruling 10: Tax point for VAT purposes in the estimation contract

Taxable Amount

• Italy assesses VAT on free services

• Can personal data constitute consideration?

• Only overdue bills of exchange represent the payment of the price for VAT purposes

• VAT on compensation for damages is not applicable

• Ruling 182: Supply of the medicine at the symbolic price of 1 euro – VATupdate
• Ruling 70: The transfer of rights incorporated in import licenses is subject to VAT

Taxable Person

• VAT deduction for the foundation carrying out commercial activities

Taxable Transaction

• Can personal data constitute consideration?

• Facebook is Not Free – Is VAT Due?

• Investigating Whether Facebook Access in Exchange for User Data is a VAT Taxable Supply

• Facebook/Meta case: “free” social networks or Barter Deal?

• ”Free access to a website” in return of ”personal data” considered as a ”Barter deal”

• VAT treatment of the sale and lease back in the light of the new clarifications provided by the Italian tax authorities

• VAT on compensation for damages is not applicable

• Out of VAT scope the transfers of assets existing in Italy as part demerger of a business unit and mergers carried out abroad

• Ruling 182: Supply of the medicine at the symbolic price of 1 euro – VATupdate
• ECJ C-250/22 (Fallimento Villa di Campo Srl) – Order – TOGC artificially broken down into a number of different supplies

• Ruling 157: Merger between entities in different countries, including a stock of assets

• Ruling 81: Public funding outside scope of VAT

Tax Authorities / Penalties

• Tax truce, penal shield and the new timing

• No penalty for wrong “nature code” in XML
• Failure to pay VAT in any case inferable from the return
• Definition of formal violations for reverse charge errors – with 200 euros all the violations committed during the year are remedied
• 2023 Budget Law – The main measures in national and international taxation
• Italy Publishes Annual VAT Return Form for Filing in 2023 in Respect of 2022
• Italy eyes cut in excise duties as anger grows over fuel prices
• Italy exempt Cryptoassets mining and utility tokens for funding offers from VAT

TOGC (Transfer of a Going Concern)

• ECJ C-250/22 (Fallimento Villa di Campo Srl) – Order – TOGC artificially broken down into a number of different supplies

Triangulation

• VAT treatment of export chain supplies

VAT Group

• Circular n. 6: Financial constraint in the VAT Group even if a foreign company intervenes

• Ruling 220: Transfer of the VAT credit in the consolidation within the group
• Ruling 208: Group VAT settlement also for non-resident companies identified in Italy

• Ruling 209: Group VAT settlement – subjective scope – non-resident companies residents identified directly in Italy

• Ruling 148: VAT Group – Foreign ”intermediate” company in the chain of control

• Principle of law 3: VAT group clarifications

VAT Identification Number

• Intra-EU distance sales taxable in Italy if the customer communicates a VAT number not registered in the VIES archive

VATUpdate Content

• More European countries implement ”Pre-Filled” VAT returns

ViDA

• A Public Consultation on EU VAT Package for the Digital Age

• Italy – Public consultation “VAT legislative package for the digital age” (deadline April 10, 2023)

Vouchers

• Ruling 29: For VAT purposes, the moment when the card is recharged for the collection of bets is irrelevant