Italy: Tax dispute resolution mechanisms, new mutual agreement procedures
Italy: Tax dispute resolution mechanisms
A legislative decree (no. 49/2020 (10 June 2020)) implements Council Directive (EU) 2017/1852 regarding tax dispute resolution mechanisms and in particular disputes arising from the interpretation and application of tax treaties—including the elimination of double taxation in connection with the adjustment of profits of related or associated enterprises.
The decree will apply to any request for a mutual agreement procedure (MAP) submitted from 1 July 2019 onwards, in relation to disputes about the tax treatment of income or capital earned in a fiscal year commencing on or after 1 January 2018.
The scope of the new MAP is much broader than that envisaged in the Arbitration Convention in that the new MAP rules apply to any situation when double taxation arises from the violation of tax treaties between EU Member States. Therefore, while the Arbitration Convention only applies to transfer pricing issues, the new MAP is expected to cover other areas such as permanent establishment assessments and disputes over withholding taxes applied in breach of treaties.
If a MAP request is filed abroad and the case concerns Italy, a MAP request must also be filed in Italy at the same time (and in Italian). The competent authorities can set up bilateral standing committees to speed up analysis of MAP cases.
Read a June 2020 report [PDF 178 KB] prepared by the KPMG member firm in Italy
© 2022 KPMG LLP, a Delaware limited liability partnership and a member firm of the KPMG global organization of independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved.
For more detail about the structure of the KPMG global organization please visit https://home.kpmg/governance.
The KPMG name and logo are trademarks used under license by the independent member firms of the KPMG global organization. KPMG International Limited is a private English company limited by guarantee and does not provide services to clients. No member firm has any authority to obligate or bind KPMG International or any other member firm vis-à-vis third parties, nor does KPMG International have any such authority to obligate or bind any member firm. The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation. For more information, contact KPMG's Federal Tax Legislative and Regulatory Services Group at: + 1 202 533 4366, 1801 K Street NW, Washington, DC 20006.