Italy Halves Web Tax Proposal

December 20, 2017 Taxation in Italy

Italian web taxROME – Italy is persevering with its plan to impose a web tax, although the rate of the tax has been dropped.

On December 19th the lower house of Italy amended the country’s 2018 budget bill, lowering the rate of the proposed “web tax”.

Italy had previously proposed that a new tax is introduced on internet transactions, levied at a rate of 6 percent of the value of the transaction.

The rate has now been dropped to 3 percent.

The new tax will be levied on the sale of “intangible digital products” namely services such as online advertising and sponsored links.

The measures are expected to hit a number of internet giants, such as Google and Facebook, which see a significant portion of their incomes coming from advertising.

The tax will not apply to all sales, and will only be paid by companies which see more than 3 000 transactions per year.

The government currently expects the tax to raise approximately EUR 190 million in taxes per year.