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Italy: Tax relief included in “liquidity decree” (COVID-19)

Italy: Tax relief included in “liquidity decree”

A “liquidity decree” (released 8 April 2020) includes measures that are intended to assist businesses by providing loan guarantees, government assumption of non-market risks, and certain targeted tax relief.


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The tax relief measures allow for the deferral of remittances of withholding tax on the salary and wages paid to employees and workers; of employment taxes including social security and welfare contributions; and payments of value added tax (VAT).

Payments due during the months of April and May 2020 can be deferred by “eligible taxpayers” if paid by 30 June 2020 (either paid in a lump sum or in five installments beginning from June 2020) without being subject to interest or penalty assessments. Eligible taxpayers are those businesses with:

  • Revenues of up to €50 million if turnover has fallen by 33% in March and April 2020 (when compared against revenue in the same months in 2019)
  • Revenues greater than €50 million, if turnover has fallen by at least 50% in March and April 2020 (when compared against revenue in the same months in 2019)

For businesses with a tax residence, registered office or place of business in certain provinces in northern Italy (Bergamo, Brescia, Cremona, Lodi or Piacenza), the deferral of VAT payments for April and May 2020 is subject to one condition only—the businesses must have suffered a decline in turnover of at least 33% (irrespective of revenues).

Other tax relief provisions concern:

  • Underpayments of advance instalment payments of IRPEF, IRES and IRAP (that is, individual income tax, corporate income tax, and the regional tax on productive activities, respectively) will not trigger interest of penalties, provided that the difference between the payment and the amount due is not more than 20%.
  • An extension of payments to the public administration that were due 16 March 2020 and deferred to 20 March 2020 will be considered timely if made by 16 April 2020.
  • The due date for payments of stamp tax (duty) has been extended to: 20 July 2020, for stamp tax due for the first calendar quarter of 2020 if less than €250; or to 20 October 2020, for stamp tax due for the first and second quarters of 2020, if the total is less than €250.
  • A tax credit is provided for the purchase of workplace personal protective equipment (PPE).

Read an April 2020 report [PDF 162 KB] prepared by the KPMG member firm in Italy

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