Noticias

Post Calendar EFEOctubre 18, 2019

Italian Government Approves Draft Budget

On October 16, 2019, the Italian Council of Ministers approved the draft Budget law for 2020, which will prevent an automatic rise in the rate of value-added tax, and includes further measures designed to combat tax avoidance and evasion.

According to the Government, the revenue-raising measures included in the draft Budget are sufficient to prevent the activation of a budgetary clause which would result in a hike in the rate of VAT next year. As such, the standard rate of VAT is expected to remain on hold at 22 percent in 2020.

The additional revenue in the 2020 Budget is mainly derived from more stringent anti-tax evasion measures. These include increased penalties for significant tax evaders, measures to combat the grey economy, and additional measures to tackle tax fraud related to fuel.

The Budget also includes plans for a register of gaming operators, and measures to encourage greater use of electronic payments, including penalties for non-acceptance of payments by debit and credit cards.

Additionally, the 2020 Budget includes a digital services tax, which is set to be effective from 2020. This is expected to apply to companies with revenues in excess of EUR750m (USD829m) and making sales in Italy of at least EUR5.5m at a rate of three percent. Services included in the scope of the digital tax include online advertising, the sale of user data, and online intermediation services.