"NEWS of the June 20, 2016-the new policy of finding countries blacklist"

Posted by on Jun 20, 2016


The National Foundation of Accountants has published no tangible document dated May 31, 2016 that analyzed the new policy valid for the purpose of identifying the States or territories to preferential tax regime.

Please note that the matter has been reformed by article 142, paragraph 1, of law 212/2015 that amended article 167, paragraph 4, of the tax code provisions regarding CFC. The current rule provides that "special tax regimes, even by States or territories are considered privileged where the nominal level of taxation is less than 50 percent of the amount applicable in Italy".

In essence, the amendment determines, on the one hand, the abandonment of the system of mandatory list of black-listed Countries and, on the other hand, the inclusion of an "automatic" policy established under law that is the presence in the country of residence or of location of the subsidiary or investee of a nominal level of taxation lower than 50% of that applicable in Italy.

NET that this should entail a burden on businesses, which will be kept in continuous monitoring of foreign tax laws, the document analysis looks like themselves two questions.

First is to clarify what is meant by the term "nominal level of taxation", since the term "nominal" had never been used to settle the case. On the subject States that

  • "the nominal level of taxation, as regards the General system of taxation of a State, should be be the nominal rate of corporate taxation, while,
  • with regard to special tax regimes, rescues the circular 207/E-237953 of November 16, 2000 in which the IRS specified that in addition to the nominal rates detect also those "formation rules of the tax base considerably different, with the consequence that taxation is in fact considerably lower."

Then there is to understand what the taxes are included in the calculation of the nominal level of taxation. According to the Foundation, for systematic reasons, it would be preferable to refer solely to the Ires, excluding instead Irap.

The second aspect concerns the identification of the disciplines contained in the income tax code – in addition to the CFC-to which the new policy applies to identification of countries with privileged taxation. The data can be taken directly from legal provisions of law 206/2015-article 1 paragraph 143-to extend the scope of application under the following circumstances:

  1. full competition to the formation of the taxable income of profits from investments from countries or territories in accordance with article 47, paragraph 4 preferential tax regime of the tax code;
  2. full competition to the formation of the taxable income of capital gains realized by the sale of shares, securities and financial instruments issued by companies resident in States or territories ilmoitetaan ex Article 68, paragraph 4, of the tax code;
  3. investee company's tax residence requirement in one State or territory other than those in privileged taxation for the purposes of the applicability of the regime of the participation exemption under article 87, paragraph 1, lett. c) of the tax code;
  4. exemption of profits and losses of permanent establishments of companies resident under article 168, paragraph 3, of the tax code.

Finally, it seems useful to say a few words in relation to the intertemporal aspect of the various regulatory amendments-stability law 2015, 2016-internationalization and stability law decree that soon involved the identification of countries with privileged taxation.

If it is common ground that the news made by 2016 stability law will produce its effects from the tax year following the year in progress at December 31, 2015 and, therefore, will be applicable for the first time in the tax return to be submitted in 2017, some doubt arises for the tax return to be submitted during the current year.

In this regard, the document argues that when presenting the unique model 2016:

  • for the purposes of regulating CFCs, you must refer to the March 30, 2015 STS (which amended the D.M. November 21, 2001) issued pursuant to article 167, paragraph 4, of the tax code;
  • for the purposes of regulations related to the limited deductibility of costs black list (1 January 2016 discipline repealed since), it should be still pointing to the m. of April 27, 2015 (which amended the D.M. January 23, 2002).

The Foundation shows that the point would still need clarifying intervention from the authorities.

Alessandro Bonuzzi