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Italy: New Legislation on Electronic Billing

(Oct. 5, 2015) On September 2, 2015, new legislation on electronic billing for value-added tax (VAT) operations entered into effect in Italy. (Legislative Decree No. 127 of August 5, 2015, Computerized Transmission of VAT Transactions and Control of the Supply of Goods Through Vending Machines, Implementing Article 9, Paragraph 1, Sections d) and g), of Law No. 23 of March 11, 2014, [L.D. No. 127], NORMATTIVA (in Italian).)

Provisions on Electronic Transmission of Invoices and Electronic Billing

As of July 1, 2016, the Revenue Agency must provide taxpayers, free of charge, a service for the generation, transmission, and storage of electronic invoices. (L.D. No. 127, art. 1(1).) Such a service is to be designed for specific categories of taxpayers who are subject to VAT. (Id.) In addition, effective January 1, 2017, the Ministry of the Economy and Finances must make an “Interchange System” available to taxpayers who by law must retain VAT and pay it to the authorities. (Id. art. 1(2).) The purpose of the Interchange System is to enable these taxpayers to transmit and receive electronic invoices generated in transactions between taxpayers residing within Italy. (Id.) These taxpayers may then opt for the electronic transmission to the Revenue Agency of data concerning all invoices issued and received, including those executed through the Interchange System. (Id. art. 1(3).)

The Revenue Agency must issue the necessary regulations to implement these provisions following consultation with the national associations that, according to European Commission Decision of 2 December 2010 (C(2010)8467) on Multi-Stakeholder Forum on Electronic Invoicing, handle electronic invoicing, in accordance with the principles of simplification, economy, and minimum burden to taxpayers. (Id. art. 1(4).)

The Ministry of Economy and Finance is charged with approving, within the next six months, new simplified, remote methods for the verification of the information submitted by those who must collect VAT, seeking to avoid undue interference with their normal economic activities. (Id. art. 1(5).)

While many taxpayers involved in retaining VAT payments and other related commercial activities may decide whether or not to use electronic storage and computerized transmission of their revenue data to the Revenue Agency, those who supply goods through vending machines will be required to use the new, online systems. (Id. art. 2(1) & (2).) The new systems will have technology in place to guarantee the inalterability and security of the data, including the information allowing payments with credit and debit cards. (Id. art. 2(3).) The Revenue Agency is charged with approving the regulations implementing these provisions. (Id. art. 2(4).)

Incentives for the Computerized Transmission of Invoices, Data, and Fees

Taxpayers who opt for the electronic transmission of the data to the Revenue Agency concerning all invoices issued and received, including those executed through the Interchange System, are not obliged to communicate the data related to contracts entered into by leasing companies and by commercial lease and rental operators. (Id. art. 3(1)(a).) These taxpayers enjoy priority in reimbursement of any excess taxes paid, after the submission of their annual tax returns. (Id. art. 3(1)(c).)

Effective on January 1, 2017, the law exempts small taxpayers subject to the VAT from some administrative and accounting requirements. (Id. art. 4(1)(a).) In particular, the Revenue Agency is to put into effect an assistance program aimed at making electronically available the documents needed for periodic payments and for the annual VAT return. (Id.) These taxpayers include those engaged in small businesses, the arts, or professions. (Id. art. 4(3).)

Avoidance of Penalties

 Although penalties are set for omitting to transmit data or sending incomplete or inaccurate data concerning the invoices issued and received, related changes, and fees to the Revenue Agency taxpayers may escape legal responsibility by transmitting corrected data within a period of time to be determined by the Revenue Agency. (Id. art. 5(1).)