- Italian tax authorities have ruled that VAT is not deductible in cases of illegal labor supply
- Non-deductibility applies regardless of end-user awareness of the illegal nature of the transaction
- Businesses cannot benefit from tax deductions for transactions violating labor laws
- Non-deductibility of VAT serves as an additional sanction for illegal labor supply practices
- Decision is consistent with previous rulings denying tax benefits for transactions against public order
- Ruling sends a message that businesses will face tax consequences for illegal labor supply arrangements
Source: eutekne.info
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
