Global Tax Alert | 19 June 2013

Italian financial transaction tax update

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Two important developments have just been announced in relation to the implementation and collection of the Italian financial transaction tax:

  • The due date for the first payment of the tax on equities has been postponed from 16 July to 16 October 2013.
  • The due date for implementation of the tax on derivatives has been postponed until 1 September 2013.

Both of these postponements are welcome given the uncertainty there has been in recent months on the detailed operation of the rules. However, it is important that those affected continue to recognize and plan for the challenges that lie ahead, in relation to both variants of the tax.

In particular, regarding the equities tax, all that has been postponed is the due date for payment to the tax authorities. Affected institutions will remain fully subject to the tax and will therefore need to continue to have a basis for determining which transactions are subject to the tax, and have a procedure for collecting it from clients. Postponing the due date for payment to the tax authorities will not, of itself, address the various uncertainties that remain as to how the tax is to be applied in particular cases. It will be welcome news if detailed guidance on the points of difficulty is available in good time before the due date for payment.

However, in relation to the equities tax, taxpayers will still be facing at least some risk that the basis on which they collect tax from clients, or budget to pay the tax themselves, turns out to be inconsistent with the basis that the Italian tax authorities ultimately apply.

Postponing the commencement of the derivatives tax has a more significant effect. It will hopefully give the Italian tax authorities time to issue detailed guidance on some of the more difficult issues before the point at which the tax enters into force. Provided that guidance is forthcoming soon, it may mean that the risk highlighted above is less acute in relation to the derivatives tax.

For additional information with respect to this Alert, please contact the following:

Studio Legale Tributario in association with EY, Milan
  • Marco Ragusa
    +39 028 814 926
Ernst & Young LLP (United Kingdom), London
  • Rod Roman
    +44 20 7951 1549
  • Mark Persoff
    +44 20 7951 9400
  • Geoff Lloyd
    +44 20 7951 8736
  • Jonathan Richards
    +44 20 7951 6428
  • Nigel Nelkon
    +44 20 7951 6011
  • Fiona Thomson
    +44 20 7951 3913
EY Steuerberatungs - und Wirtschaftsprüfungsgesellschaft mbH, Vienna
  • Thomas Wilhelm
    +43 1 211 70 1398
EY Société d'Avocats, Paris
  • Matthieu Dautriat
    +33 1 55 61 11 90
  • Nacéra Beniken
    +33 1 55 61 10 69
Ernst & Young GmbH Wirtschaftsprüfungsgesellschaft, Frankfurt
  • Volker Bock
    +49 6196 996 27459
EY Abogados, Madrid
  • Adolfo Zunzunegui Ruano
    +34 91 57 27 889
EY, S.A., Lisbon
  • Nuno Bastos
    +351 217 912 000
EY Belastingadviseurs LLP, Amsterdam
  • Willem-Jan van Veen
    +31 88 407 209
Ernst & Young LLP, Financial Services Desk, New York
  • Miles Humphrey
    +1 212 773 1425
  • Raffaele Gargiulo
    +1 212 773 3505
  • Sarah Belin-Zerbib
    +1 212 773 9835

EYG no. CM3545