Italy updated list VAT split payment system, Romania also proposes VAT split payment system
Early August 2017, the Italian Ministry of Economy and Finance published the updated lists of companies qualifying for the revised split payment system in force in Italy as from July 1, 2017 (system was introduced in 2015).
The split payment now also applies to supplies of goods and services to:
- companies directly or indirectly controlled by the Presidency of the Council of Ministers and the Ministries, as defined by article 2359(1) and (2) of the Civil Code;
- companies directly controlled by local public bodies, as defined by article 2359(1) of the Civil Code;
- companies directly or indirectly controlled by the above companies, as defined by article 2359(1) of the Civil Code; and
- companies listed on the FTSE MIB Italian stock exchange.
The lists are available on the website of the Italian Ministry of Economy and Finance.
Following Italy, the Romanian Ministry of Finance published a draft Ordinance also providing for a VAT split-payment mechanism. The proposal is for taxable persons to have a separate VAT bank account wherein VAT amounts are paid by the customers. The VAT account is further used for VAT settlements with the Romanian tax authorities. Failure to comply with the VAT split-payment mechanism (by both beneficiaries and suppliers of taxable transactions) results in the application of fines.
If enacted, the proposed amendment, is mandatory as from October 1, 2017 (optional as from September 1, 2017).
As already communicated, also Poland is looking into the split VAT payment mechanism.
We will keep you updated of changes in this respect.