1) Financing deposits granted to
resident firms
The ‘Manovra Prodi’ expounds
a series of regulations with the purpose of ratifying the frequent evasive practice
utilised as means of financing for resident firms. The behaviour that they intend to
sanction is : money, stock and shares or any other securities deposits, different from
participations to the risk, made with the aim of obtaining the necessary provision to the
company reducing, therefore, tax liability and, at the same time, taking advantage of the
lowest taxation (27%) provided for the income deriving from capital (Tab. 1.a.).
In order to oppose this evasive practice
the ‘Manovra Prodi’ has provided, added to the ordinary taxation, the payment of
an amount par to the 20% of the income which ensues from the securities financing deposits
(Tab. 1.b.).
The anti-evasion regulation is enforceable
for the deposits, with the exception of those carried into effect in the corporation
activity firm, respectively executed by natural persons, simple companies, not
commercial corporation and lastly by non-resident persons without a permanent
establishment on the State territory.
2) Income capital taxes for non-resident
persons
The Law by Decree 323/96 has as well
introduce a series of significant changes with the purpose of ratifying the tax advantages
deriving from the ‘conduit’ operations which previously permitted the evasion of
the withholding tax on interests applicable to financing made by foreign credit
institutions in favour of Italian companies.
As previously mentioned in the article 26
of the Presidential Decree 600/73, the interests paid to the foreign branch corporations
of the Italian credit institutions were not submitted to the withholding tax. In the case
of the ‘conduit’ structure, the withholding tax was not enforceable in so far as
the foreign branch of an Italian Bank was considered as a full legal person with its
Italian parent company, and as such, did not suffer any withholding tax on the received
interests (Tab.2.a.).
In turn, the foreign branch was not obliged
to enforce the withholding tax allowed by the Italian regulation regarding the interests
paid to non-resident persons.
The ‘Manovra Prodi’ introduced,
integrating the article 26, a regulation regarding the interests on the
‘conduit’ operations which are submitted to a withholding tax of 15% (Tab.2.b.).
The withholding tax is enforced to the incomes paid to a foreign permanent establishment
of the resident companies which don’t belong to the same group of companies which
makes the payment of the profit.
This last solution allows to exclude from
the withholding tax, the incomes paid by the parent company to a legal structure belonging
to the same group of companies.
3) Provisions in matter of gift taxes
The article 10 of the Law by Decree
323/96 has introduced important changes to the taxation regime regarding the donations of
National Debt securities (BOT). Previously to the changes introduced by the Law by Decree
in question, the donations of National Debt securities, including ordinary treasury bills
(BOT), treasury credit certificates (CCT) and any other State bonds, were subdued to a
fixed taxation (Lit 100’000). Further to the coming into effect of the ‘Manovra
Prodi’ the application of the fixed taxation will be limited to the donations of any
gift or right declared exempt from taxation by the law, with the exception of donations of
National Debt securities.
Its purpose is to counter an extremely
diffused phenomenon and obviously evasive, allowing the transfer of important estates, for
example, from father to son, in National Debt bonds form, delivering them by this way to
the normal taxation provided for death-duty matters.
4) Introduction of the fixed taxation in
matter of merging intra-communitary operations
With the ‘Manovra Prodi’,
Italy conformed itself, after nearly ten years, to the regulations contained in the
Directive 69/335/CEE, modified by the most recent Directive 85/303/CEE, which ratify the
inapplicability of the proportional taxation of registration for companies re-organisation
operations, taking in consideration the fact that these operations cannot produce any new
wealth. The beginning of the actual reform, article 10 paragraph 5 letters b and c, Law by
Decree 323 of June 20th, 1996, comes from the recent decision of the European Community
Court of Justice, which has been applied in France and has forced the Italian Government
to revise its position and to give free rein to the tax neutrality for intra-communitary
companies re-organisation.
Enforcing to the new regulations are
subduable to the registration fixed taxation of Lit 250’000 all the re-organisation
operations, including the merging operations, the split operations, the transfer of
companies or group of companies regarding the line of business of the same company,
operated from a company to another yet existing or future company.
The previously regulation allowed a 1%
taxation for this kind of operation.
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