Italy's new coalition government sets out its policy priorities

International Tax Review is part of Legal Benchmarking Limited, 1-2 Paris Garden, London, SE1 8ND

Copyright © Legal Benchmarking Limited and its affiliated companies 2025

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

Italy's new coalition government sets out its policy priorities

Sponsored by

sponsored-firms-hager.png
Policy

Gian Luca Nieddu and Barbara Scampuddu of Hager & Partners summarise the new coalition government’s policy priorities as regards the economy and tax.

On September 9 2019, Italy’s new government passed a confidence vote in parliament, and subsequently on September 5 2019, Italy's new cabinet swore before the president of the republic, sealing the alliance between the Five Star Movement (M5S) and the Democratic Party (PD).

The new coalition agreed on a 29-point programme to rule Italy for the rest of the term of the legislature (approximately three-and-a-half years). In terms of the economy and tax, general drivers seem to point to:

  • A commitment to use the forthcoming budget to stimulate economic growth, securing at all costs the stability of public finances;

  • Blocking the increase in the VAT rate, which is set to kick in automatically on January 1 2020 if the government fails to reach its debt-reduction target. Nevertheless, preventing the activation of VAT increases would probably entail making substantial spending cuts, alternative tax increases or a substantial revision of tax expenditure to meet fiscal targets;

  • Drawing up a tax reform, including the simplification of the regulation, the reshaping of the rates along with a revision of the deductible costs, and a more effective cooperation between taxpayers and the tax administration;

  • A reform of the civil, criminal and tax justice systems in order to make them more efficient, including through a drastic reduction of the duration of trials; and

  • The introduction of a 'web tax' for multinational enterprises engaged in the digital industry in order to target those players which move profits to countries other than those in which they sell their products.

In forthcoming months more detail will be disclosed on the contents of the proposed provisions and the impact they may have both on the domestic economy and on international businesses, and which represent vital changes for many small and medium-sized enterprises.

more across site & shared bottom lb ros

More from across our site

The US president also unveiled a new 50% levy on copper imports; in other news, a UK wealth tax proposal has been criticised by the Institute for Fiscal Studies
Wim Wuyts, who had been head of the specialist tax network since 2017, is moving on to a new role with WTS’s Belgian member firm
MNEs are increasingly using algorithmic tools in TP. Sahasranshu Dash argues that data ethics should therefore plug directly into the TP design process
The Institute of Chartered Accountants in England and Wales also queried whether HMRC resources could be better spent scrutinising larger entities
Grant Thornton’s Austria tax head likens his practice to an escape room, shares his football coaching ambitions, and explains why tax is cool
Awards
ITR is delighted to reveal all the shortlisted nominees for the 2025 EMEA Tax Awards
Awards
ITR is delighted to reveal all the shortlisted nominees for the 2025 Asia-Pacific Tax Awards
The fates of pillars one and two hang in the balance after the US successfully threw its weight around in G7 and Canadian negotiations
Rafael Tena tells ITR about the ‘crazy’ Mexican market, ditching the hourly rate, and refusing to grow his fledgling firm in an ‘unstructured way’
It should be easy for advisers to be transparent about costs, Brown Rudnick partner Matthew Sharp said in response to exclusive ITR in-house data
Gift this article