Italy: Robin Hood Tax on energy companies declared illegitimate
International Tax Review is part of the Delinian Group, Delinian Limited, 4 Bouverie Street, London, EC4Y 8AX, Registered in England & Wales, Company number 00954730
Copyright © Delinian Limited and its affiliated companies 2024

Accessibility | Terms of Use | Privacy Policy | Modern Slavery Statement

Italy: Robin Hood Tax on energy companies declared illegitimate



Giuliano Foglia

Giovanni d’Ayala Valva

With the February 11 2015 decision n. 10/2015, the Italian Constitutional Court declared the 'Robin Hood Tax' unconstitutional. The removal of the Robin Hood Tax is being welcomed by energy companies, since it determines a significant reduction of the tax burden (from 34% per cent to 27.5%) and boosts earnings. The Robin Hood Tax was introduced in 2008 as a surtax on certain companies operating in the energy sector to rein in what was considered an excessive profits from high oil prices. Starting from 2011, it became applicable also to companies active in the renewable energy sector

In a nutshell, the Robin Hood Tax consisted in a surcharge of 6.5% of the ordinary corporate income tax rate and it was applicable to companies that exceeded certain financial thresholds.

With the decision n. 10/2015 the Constitutional Court upheld the taxpayers' claim and declared Robin Hood Tax in breach of the principles of equality and ability-to-pay established by articles 3 and 53 of the Italian Constitution.

In particular, the Court underlined that: (i) Robin Hood Tax was supposed to tax extra-profits but it actually taxed the overall taxable income; (ii) the intention of the legislator was to introduce a temporary surtax to face specific economic circumstances but it has become an ordinary corporate income tax for energy companies, without any specific link with the taxpayer's ability to pay; (iii) notwithstanding the express ban provided by the law, the impossibility to prevent companies from shifting the burden of such tax onto consumers was proved.

According to decision n. 10/2015 the declaration of unconstitutionality does not apply retroactively and its removal is, therefore, effective as from the day after its publication in the Official Gazette (that is, February 11 2015).

Despite Italian law allowing for decisions of the Constitutional Court to be, in principle, retroactive, the Court in this case expressly limited its verdict to the future, to avoid a potentially massive adverse effect on the Italian public accounts.

This should mean that there is no room to claim for the refund of the sums paid in the past.

It is, however, unclear whether the decision affects 2014 considering that calendar year taxpayers have still (i) to pay the balance of the corporate income tax (in June 2015); and (ii) to file the 2014 tax return (in September 2015). It is also still unclear what happens for taxpayers whose fiscal year does not coincide with the calendar one. Other issues have arisen with respect to the impact of the decision in relation to the relevant accounting treatment of the deferred tax assets and liabilities due to taxable temporary differences.

Clarifications by the Italian tax authority are expected.

Giuliano Foglia ( and Giovanni d'Ayala Valva (

Tremonti Vitali Romagnoli Piccardi e Associati

Tel: +39 06 3218022 (Rome); +39 02 58313707 (Milan)


more across site & bottom lb ros

More from across our site

Amount B is meant to increase simplicity and reduce uncertainty, but US TP specialists claim it may lead to controversy
Tax Foundation economist Alan Cole also signalled that pillar two has a 'considerable chance' of failing
The Labour Party is working hard to convince business that it will bring stability to tax policy if it wins the next UK general election. But it will be impossible to avoid creating winners and losers
Burrowes had initially been parachuted into the role last summer to navigate the fallout from the firm’s tax leaks scandal
Barbara Voskamp is bullish on hiring local talent to boost DLA Piper’s Singapore practice, and argues that ‘big four’ accountants suffer from a stifled creativity
Chris Jordan also said that nations have a duty to scrutinise the partnership structures of major firms, while, in other news, a number of tax teams expanded their benches
KPMG has exclusive access to the tool for three years in the UK, giving it an edge over ‘big four’ rivals
But the US tax agency’s advice is consistent with OECD guidance and shouldn’t surprise anyone, other experts tell ITR
A survey of more than 25,000 in-house counsel reveals that diversity initiatives are a high priority when choosing external counsel
The report is aimed at helping 'low-capacity countries', the OECD has claimed
Gift this article