ROME: Following the approval by Parliament of Law No.23 of 11 March 2014, the Italian Government is now taking action and adopting the Legislative Decrees necessary to enforce this innovative tax reform. In fact, on 21 April 2015 the Council of Ministers has approved the drafts of three Legislative Decrees that are currently under the examination of the relevant parliamentary commissions.
The preliminary drafts cover the following topics: (i) new rules for facilitating foreign investments, (ii) electronic VAT invoices,[3] and (iii) abuse of law and co-operative tax compliance[4].
For the purpose of the present Client Alert, we will focus on the new rules set forth by the preliminary draft for facilitating foreign investments (hereinafter the “Draft”), which implement Articles 1 and 12 of the Legge Delega. The Draft addresses several issues important both for foreign entities willing to invest in Italy and for resident companies that are part of multinational groups. The aim is to introduce new procedures able to create a transparent framework for cross-border transactions, in an effort to avoid tax audits/litigation in Italy. In particular, below we examine:
the new regulations governing the international ruling procedure and the implementation of a full transparency in the preliminary debates of foreign investors with the Italian Tax Authorities; and
the new tax rulings (the so-called “interpello”) for large investments in Italy (i.e. minimum €30 million).
Article 1 of the Draft will abolish the former rules governing the current international ruling and introduce a new procedure that can be requested for a wider range of circumstances.
