ITALY - POTENTIAL CHANGES IN PROPERTY TAX
Italy's new prime minister Mario Monti has proposed several new measures to help get Italy's budget deficit under control, including the possible reintroduction of Municipal property tax (ICI impostacomunalesugliimmobili) on primary residences, together witha change of mechanism in calculation, with the introduction of a tax determined proportionately based on the value of the property itself.
ICI is a communal tax charged on the possession of buildings, buildable areas and agricultural land situated within the State territory, intended for any use, including property used in performing company activities. Currently, ICI is calculated by applying to the tax assessment basis the rate fixed by each Municipality varying between 4/1000 and 7/1000, which may reach a maximum of 9/1000. The tax assessment basis is represented
For agricultural buildings and land, by the land income multiplied by coefficients varying based on the intended use of the property;
For buildable areas, by the commercial value of the property at the 1st of January in the year of taxation.
According to its former economy minister GuilioTremonti in a letter sent to the European authorities upon him leaving office earlier in November, much of Italian wealth is invested in property and the letter suggests the introduction of a permanent property tax to generate revenue and economic growth (estimated €3.5 billion per year).
It seems Monti, who is also Italy's finance minister, agrees, having already commented that the tax on Italy's privately-owned property is very low in comparison with other European countries; particularly as currently primary residences are exempt from local taxes.
For further information please contact Dr. Francesco Marconi at HLB member firm Studio Associato De Vecchi.
Studio Associato De Vecchi
Phone: +39 02 48100471
About Studio Associato De Vecchi
Studio Associato De Vecchi is a member of HLB International. On 25th November 2009 Studio Associato De Vecchi set up the HLB Consultants Italia professional network, in association with four leading Italian tax and labour law consultancy practices. Currently HLB Consultants Italia has six main offices, with 31 associates and a staff of more than 120 people.
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