Italian Tax Amnesty Provides Reduction of Fines for Unpaid Taxes
Italy has introduced a new tax amnesty aimed at encouraging taxpayers to settle their pending tax charges while benefiting from significant reductions in fines and sanctions. The initiative, known as the Voluntary Correction, is part of the recently enacted Budget Law 2023 (Law no. 197/2022).
The Italian Revenue Agency (IRA) has issued an Interpretation Paper, specifically Note no. 2/E/2023, which analyzes the Voluntary Correction regime provided for in Articles 1 § 174 to 178 of the Budget Law 2023.
The Voluntary Correction applies to violations relating to validly submitted tax returns for fiscal years ending on or before December 31, 2021. However, it is important to note that tax returns that haven’t been filed at all cannot be settled through this measure. Violations related to returns submitted within 90 days of the submission deadline, which are not considered omitted under art. 2 co. 7 DPR 322/98, are still eligible for the amnesty.
Under the Voluntary Correction, taxpayers can benefit from a reduction of up to 1/18th of the minimum legal fines applicable to their violations. Additionally, taxpayers have the option to pay their outstanding tax charges in installments, with a maximum of eight quarterly installments, each of equal value.
It is worth noting that the Voluntary Correction allows for the amicable settlement of significant tax return violations and substantial violations that are preconditional to the submission of the tax returns. However, it is important to understand that the regularization of the tax return does not automatically amend these violations.
Each individual violation must be amended and adjusted, along with the settlement of the reduced fines. Cumulative sanctions and continuation mechanisms do not apply in this regard.
The following types of violations can be settled through the Voluntary Correction:
– Inaccurate or incomplete tax returns.
– Failures to submit communications or withholdings.
The IRA has stated that no implementing decree will be issued for the Voluntary Correction as regulated in the Budget Law 2023, as the provisions are already clear. However, the IRA will release an additional dedicated Note providing reference codes to be indicated on the F24 Forms.
For any circumstances not explicitly addressed by the Budget Law 2023 or the Interpretation Paper, the IRA’s clarifications regarding ordinary voluntary corrections over the years will apply.
This news article provides an overview of the Italian tax amnesty introduced by the Budget Law 2023. Taxpayers now have the opportunity to settle their outstanding tax charges with reduced fines and the option to pay in installments. By taking advantage of the Voluntary Correction regime, individuals and businesses can regularize their tax affairs and benefit from the incentives provided by the Italian government.
