Edited by By Alessia Zanatto, Francesco Pizzo, Alessia Lippi, Anna Rossodivita, Ludovica Copia, Anna Tripodi
Law No. 207/2024, concerning the “Budget of the State for the financial year 2025 and multiannual budget for the period 2025-2027” (“Budget Law”), has been published in the Official Gazette No. 305 on December 31, 2024. In this document, we briefly analyze the most significant new provisions introduced regarding VAT, customs, and excise duties.
Paragraph 12 (Change to the thresholds for accessing the flat-rate tax regime)
Paragraph 12 amends paragraph 57, letter d-ter), of Article 1, Law No. 190/2014, increasing the threshold of income from employment or equivalent sources, beyond which access to the flat-rate tax regime is denied, from 30,000 euros to 35,000 euros for the year 2025.
Paragraphs 38 – 44 (VAT liability for training services provided to employment agencies by entities and companies funded through the bilateral fund)
Paragraphs 38 to 44 establish VAT taxability for training services provided to authorized employment agencies under Article 4 of Legislative Decree No. 276/2003, by entities and training companies financed through the bilateral fund set up under Article 12, paragraph 4, of Legislative Decree No. 276/2003.
There have been divergent interpretations regarding the VAT treatment of these services. Considering the previous interpretative uncertainty[1], the Budget Law still consider valid the actions taken by taxable persons concerning the aforementioned services rendered before the Budget Law came into force (i.e., January 1, 2025), for which definitive acts of assessment have not occurred. The provision also specifies that no tax refunds are provided.
Pending matters as of the entry into force of this provision in the Budget Law (i.e., January 1, 2025), regardless of the state and level of litigation, can be resolved upon request by the party involved through the payment of the assessed additional VAT, without penalties and interest, or by presenting proof of the settlement of the VAT amount by the service provider. Amounts due shall be reduced by those already paid during the litigation process.
For the purpose of extinguishing the judgment, subject to the acceptance of the request by the Italian Tax Authority (which must be verified within 30 days from the submission of the aforementioned request), the taxable person must file with the competent judicial authority proof of the VAT payment carried out by the service provider.
Paragraph 45 (Movement of energy products subject to excise duty)
Modifies paragraph 8 of Article 25 of the Consolidated Act of Legislative Provisions concerning production and consumption taxes and related criminal and administrative penalties, as per Legislative Decree No. 504/1995, extending the obligation to circulate with the accompanying document (i.e., e-DAS), as stated in Article 12 of the same Consolidated Act, also to energy products subject to excise duty, transferred in quantities not exceeding 1,000 kilograms to warehouses not subject to reporting under Article 25 of the Consolidated Act.
Paragraph 49 (Amendment of item no. 127-sexiesdecies of Table A, Part III, attached to Presidential Decree No. 633/1972)
Paragraph 49 amends, effective from January 1, 2025, the list of goods and services subject to a reduced VAT rate of 10%, as outlined in Table A, Part III, of Presidential Decree No. 633/1972, by replacing item 127-sexiesdecies and excluding from the application of the reduced rate the landfill disposal and incineration without efficient energy recovery of urban waste and special waste.
Paragraphs 57-63 (Extension of the reverse charge mechanism to services provided under contracts for the handling of goods)
Paragraphs 57-63 amend Article 17, paragraph 6, letter a-quinquies, of Presidential Decree No. 633/1972, extending the reverse charge mechanism to service performances carried out through contracts of procurement, subcontracting, assignments to consortium members, or any contractual relationships characterized by a predominant use of labor and instrumental goods owned by the client, provided to companies engaged in the transport and movement of goods and logistics services, with the declared aim of combating tax evasion that is prevalent in the sector.
The effectiveness of the provision is contingent upon the issuance of a specific authorization by the Council of the European Union. In this regard, pending the full implementation of the aforementioned provisions, the service provider and the client may choose for the payment of VAT on the services rendered to be made by the client on behalf of and for the account of the service provider, who is jointly liable for the VAT due. In particular, the option is valid for three years and must be communicated by the client to the Italian Tax Authority using a specific form that will be approved by the director of the Italian Tax Authority and made available free of charge in electronic format on the Italian Tax Authority’s website[2].
According to this option, the invoice is issued by the service provider, pursuant to Article 21 of Presidential Decree No. 633/1972, and VAT is paid by the client, with no possibility of offsetting. In this regard, if VAT is not due, the right to get the refund belongs to the client, provided that the latter demonstrates the actual payment of the VAT. The client would also be subject to the application of the penalty outlined in Article 6, paragraph 9-bis.1, first sentence, of Legislative Decree No. 471/1997 (i.e., an administrative penalty ranging from €250 to €10,000), for which the service provider is jointly liable, in cases where, despite the required conditions for the application of the reverse charge being met, the amount of VAT relating to a sale of goods or a provision of services has been incorrectly settled by the seller or provider.
The aforementioned legislative provision states that, in such cases, the right of the purchaser or client to deduct VAT is unaffected.[3] This provision does not apply, and the client is subject to the penalty mentioned in paragraph 1 of the cited Article 6 (equal to 70% of the tax related to the incorrectly documented or recorded taxable amount) when the application of VAT via the ordinary regie (instead of through the reverse charge) results from an intent to evade or commit fraud of which the client is proven to be aware.
Paragraph 64 (5% VAT rate on mountaineering sports courses)
Paragraph 64 amends, effective from January 1, 2025, number 1-septies) of Table A, Part II bis, of Presidential Decree No. 633/1972, extending the application of the 5% VAT rate to the provision of mountaineering courses conducted by independent mountain guides, pursuant to Article 2, paragraph 1, letter c), of Law No. 6/1989.
Paragraphs 72 and 73 (Provisions regarding excise duty applicable to microbreweries)
Paragraphs 72 and 73 amend Article 35 of Legislative Decree No. 504 of 1995, specifically paragraphs 3-bis and 3-quater, extending until 2025 the application of the current reduced excise duty rates on beer and the simplified assessment procedures established for the benefit of so-called microbreweries.
Paragraphs 74-77 (obligations for recording and electronic transmission of payment data)
In order to contrast evasion related to electronic payments and the interoperability of databases[4], paragraph 74 completely replaces paragraph 3 of Article 2 of Legislative Decree No. 127/2015, which governs the electronic transmission of payment data, is completely replaced to ensure full integration and interaction between the process of recording payments and the electronic payment process. For this purpose, the hardware or software tool through which electronic payments are accepted must always be connected to the tool used for the accurate recording, storage, and aggregated transmission of payment data as well as daily electronic payment data.
Consequently, paragraph 75, following the changes introduced in paragraph 74, amends Article 11 of Legislative Decree No. 471/1997, extending the application of the administrative penalty for the failure, late, or incomplete transmission of daily payment data that has not affected the determination of the amount of VAT, as stated in paragraph 2-quinquies of the same decree, to cases of violation of the obligations to record or transmit electronic payments; furthermore, it amends paragraph 5, establishing that the administrative penalty ranging from €1,000 to €4,000 for the failure to install devices for issuing fiscal receipts also applies in the case of failure to connect the hardware or software tool through which electronic payments are accepted.
Paragraph 76, in turn, amends Article 12 of Legislative Decree No. 471/1997, concerning ancillary penalties related to direct taxes and value-added tax, providing that:
- the penalty regime applicable for the violation of the obligation to issue a fiscal receipt or sales receipt shall also apply to cases of using tools that do not guarantee the integrity and security of data, as well as the full integration and interaction of the process of recording payments with the electronic payment process (an additional situation provided in the new formulation of paragraph 3 of Article 2 of Legislative Decree No. 127/2015), if the violations consist of failure to maintain or transmit data in a timely manner, or maintaining or transmitting incomplete or untruthful data. Therefore, if four separate violations are contested over a five-year period, committed on different days, the license suspension is provided for a period of three days to one month (Article 12, paragraph 2, Legislative Decree No. 471/1997). If the total amount of contested payments exceeds €50,000, the suspension is for a period of one month to six months.
The aforementioned penalty also applies in cases referred to in Article 2, paragraphs 1, 1-bis, and 2 of Legislative Decree No. 127/2015, which governs cases in which electronic storage and telematic transmission of payment data is mandatory (i.e., transactions referred to in Article 22 of Presidential Decree No. 633/1972, not certified by the issuance of an invoice; sale of gasoline or diesel intended to be used as fuel for engines; sales of goods or services through automatic vending machines) and the ways this must be carried out (i.e., through technological tools that ensure the integrity and security of data as well as the full integration and interaction of the process of recording payments with the electronic payment process); - in the case of failure to connect the hardware or software tool through which electronic payments are accepted: suspension of the license or authorization to operate in the designated premises for a period of fifteen days to two months. In the event of recurrence, the suspension is imposed for a period of two to six months (Article 12, paragraph 3, Legislative Decree No. 471/1997), without prejudice to the application of the aforementioned administrative fine ranging from €1,000 to €4,000 pursuant to Article 11, paragraph 5-quinquies, Legislative Decree No. 471/1997.
Paragraph 77 sets the effective date of the measures discussed in paragraphs 74 to 76, starting from January 1, 2026.
Paragraph 80 (Extension to the Italian Customs Authority for the consultation and use of electronic invoices)
According to paragraph 80, it amends paragraphs 5-bis and 5-ter, Article 1, Legislative Decree No. 127/2015, regarding electronic invoicing and telematic transmission of invoices or their related data, stating that the files of the acquired electronic invoices must be stored until December 31 of the eighth year following the submission of the relevant declaration or until the conclusion of any legal proceedings, in order to be used also by the Italian Customs Authority (currently anticipated for the Italian Tax Authority and the Financial Police) limited to the sale of products subject to supervision and control as per Article 18 of Legislative Decree No. 504/1995 (i.e., products subject to excise duty and those subject to other indirect taxes as outlined in the mentioned consolidated text on excise duties). The Italian Customs Authority is required to adopt appropriate security measures and to obtain the necessary opinion from the Privacy Authority.
[1] It should be noted that the question of whether these training services, when “funded” through a bilateral fund pursuant to Article 12, paragraph 4, Legislative Decree No. 276/2003, were subject to VAT or exempt from VAT under Article 10, paragraph 1, number 20) of Presidential Decree No. 633/1972 has been heavily debated, even in judicial terms with non-uniform orientations.In favor of applying the VAT exemption: Regional Tax Court of Lombardy Milan, ruling No. 189 of January 17, 2024; Regional Tax Court of Lombardy Milan, ruling No. 3198 of July 10, 2023; Regional Tax Court of Lombardy Milan, ruling No. 544 of February 9, 2023. Against the application of the VAT exemption: Regional Tax Court of Lombardy Milan, ruling No. 3786 of October 19, 2021; Regional Tax Court of Lombardy Milan, ruling No. 1743 of May 10, 2021; First Instance Tax Court of Milan, ruling No. 26 of January 3, 2023; Provincial Tax Court of Milan, ruling No. 1709 of 2022.
[2] The publication of the aforementioned form is pending on the official website of the Italian Tax Authority
[3] Without prejudice to the cases of VAT non-deductibility pursuant to Article 19 of Presidential Decree No. 633/1972
[4] The Explanatory Report to the 2025 Budget Law, in relation to this legislative amendment, clarified the following: “Provisions to combat tax evasion regarding electronic payments and interoperability of databases.” Paragraph 1 amends Article 2 of Legislative Decree No. 127 of 2015, replacing paragraph 3, in order to integrate the process of fiscal certification (storage and transmission of revenues) with that of electronic payment, specifically highlighting any inconsistencies between receipts (from electronic transactions) and issued receipts.
A technical connection requirement is introduced between electronic payment instruments (both physical and digital) and the electronic cash register so that the latter can always store the minimum information of all electronic transactions (excluding those related to customer identification) and transmit to the Revenue Agency the total amount of daily electronic payments collected by the merchant, even independently of the registration of the receipts (…).
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