By Davide Anghileri, University of Lausanne
On 1 June, the Italian Revenue Agency released new guidance (Circulare no. 13/E) clarifying the VAT reporting obligations of online platforms that facilitate remote (or distance) sales.
The Italian Revenue Agency noted that under Italy’s new VAT provision, contained in Law Decree No. 34 of 30 April 2019, an entity that manages an online platform is liable for VAT owed by EU or non-EU suppliers of goods and services that use the platform.
The new law’s presumption operates when the platform manager does not transmit or incompletely transmits data of the aforementioned operations to the tax authority.
To overcome this presumption, the manager must demonstrate that the supplier has actually paid the tax or that it could not reasonably have known that this information was incomplete or incorrect.
The Italian Revenue Agency said in the new guidance that the supplier can present any suitable documentation certifying payment of VAT due (i.e., F24, bank documentation, tax returns, etc.). In any case, the absence of the aforementioned documentation creates an obligation for the platform to pay VAT on the facilitated distance sale.
To prevent any risk and to ensure the correctness of the data, an adequate internal due diligence system should be put in place.
If a platform ascertains that the data communicated is incorrect or incomplete, the platform must correct the errors and send a new communication to the tax authority; otherwise, the platform will become liable for the payment of VAT.
The guidance also clarifies that the data should be transmitted by the end of the month following each quarter, starting from the entry into force of the law. Corrective reports can not be filed after the second month following the relevant quarter.
If these requirements are not met, the platform will be liable for the Italian VAT on the sales for which it has failed to send information, unless it can prove that the VAT has been paid by the supplier.
The VAT provisions in Law Decree No. 34, which addressed urgent measures for economic growth, will expire with the entry into force of the EU VAT directive.
Davide Anghileri
Davide Anghileri is a PhD candidate at the University of Lausanne, where he is writing his thesis on the attribution of profits to PEs. He researches transfer pricing issues and lectures for the Master of Advanced Studies in International Taxation and Executive Program on Transfer Pricing.
Anghileri, a Contributing Editor at MNE Tax, previously worked as a policy advisor to the Swiss government on BEPS issues.
Davide can be reached at [email protected].
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