Italy: Guidance on application and administration of digital services tax

Italy: Guidance on digital services tax

The Italian tax authority on 23 March 2021 released guidance to clarify various aspects of the application and administration of the Italian digital services tax.


Circular 3/2021 (23 March 2021) provides in 88 pages, guidance that clarifies many issues, including the following:

  • The nature of the digital services falling within the scope of the digital services tax
  • Excluded services
  • How to calculate the taxable revenue and the proportion of that revenue deriving from services linked to the territory of Italy
  • The registration process, the preparation of accounting documentation and the submission of the digital services tax return

KPMG observation

Given the complexity of the Italian digital services tax, many aspects of the tax still are not clear, despite this initial clarification from the tax authority. Nevertheless, the circular provides some guidance to persons subject to the digital services tax and regarding the tax payment remittance and return filing obligations for 2020—due by 16 May 2021 (payment) and 30 June 2021 (return filing).

Read a March 2021 report [PDF 162 KB] prepared by the KPMG member firm in Italy

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