Italy withdraws VAT split payments

Mon 9th Jul 2018

Italy’s Minister for Economic Development has said that anti-VAT fraud split payments regime will be abolished for professional service transactions to government.

Italian split payments involve customers paying the VAT element of invoices directly to the tax authorities. Split payments are obligatory in Italy for B2G transactions only.

This reduces the opportunity for VAT fraud. Italy has the EU’s largest VAT Gap – the difference between VAT forecast revenues, based on the size of the economy and VAT rates, versus actual VAT receipts.

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