As from 13 of December following changes will be applied concerning VAT Law:

• The increase to 50% of the standard VAT deduction (as per the article 74, paragraph 6, Presidential Decree no. 633/1972) provided for sponsorship transactions related to entertainment, games and other activities as per the Tariff enclosed on the Presidential Decree no. 640/1972;
• The increase from 25,82 euro to 50 euro of the unit value of the gifts according to which the VAT deduction is allowed, in order to coordinate the above limit deduction to the one provided for income taxes purposes (as provided by Article 108, paragraph 2, of the TUIR – Income Taxes Code);
• The extension of the possibility to recover VAT, paid upon the tax point, according article 26, paragraph 2, of the Italian VAT Code, in the case the consideration has not been paid also “due to a validated debt restructuring agreement pursuant to the article 182-bis, Royal Decree no. 267 dated March 16, 1942, or due to certified reformation plan according to the article 67, letter d), Royal Decree no. 267 dated March 16, 1942, published on the Companies’ Register” (article 31 legislative decree);
• The amendments of the criteria provided to identify non luxury houses for which the reduced VAT rate of 4% applies on the relevant supplies. In particular, are considered “non luxury houses” those classified in the cadastral categories other than A1, A8 and A9 (article 33 legislative decree).

For further details please contact Luca Lavazza, PwC Partner: phone: +39 02 91605701 or email: luca.lavazza@it.pwc.com