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Italy to introduce a voluntary disclosure programme?


In January 2014 Italy proposed to implement a voluntary disclosure programme with the aim of urging taxpayers to declare any undisclosed assets and funds. Taxand Italy discusses white and black lists and how the voluntary disclosure programme would work if introduced.

The voluntary disclosure programme would allow taxpayers who hold undisclosed financial assets or foreign bank accounts to declare these assets and funds in order to become compliant with Italian law and to prevent substantial tax penalties and criminal prosecution risks. 

Under the voluntary disclosure programme taxpayers would have the opportunity to declare hidden assets and funds and pay smaller penalties - up to half - in one installment. They would also not be subject to criminal punishment. The option of the voluntary disclosure programme would only be permitted before any investigation of the tax authority. Once an audit is under way taxpayers would no longer be able to use the programme to their advantage.

Within the proposed voluntary disclosure programme there are 2 listings - the white list and the black list. The white list covers taxpayers who have not filed correct tax returns for 4 or 5 years. In the case of an incorrect tax return they would pay 100% of the higher assessed tax. In the case where tax returns were completely omitted the taxpayer would pay 120% of the higher assessed tax. The black list covers taxpayers who have not filed correct tax returns for 8 or 10 years. In the case of an incorrect tax return they would have to pay 200% of the higher assessed tax. In the case where tax returns were completely omitted the taxpayer would would have to pay 240% of the higher assessed tax. 

Discover more: Italy to introduce a voluntary disclosure programme? 

Your Taxand contacts for further queries are:
Alfredo Fossati
T. +39 2 72 60 591

Silvia Candeloro

Luca Galliani

Taxand's Take

Italy have proposed the voluntary disclosure programme at a time where jurisdictions around the world are calling for further action to address the issues of international tax avoidance and evasion. While the January 2014 proposal was not converted into law, from May 2014 the Italian Government aim to work on a new version of the proposal to be introduced later this year. 

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