“According to Council Implementing Decision (EU) 2023/1552, published in the Official Journal of the European Union on July 27, 2023, the split payment mechanism for Vat was extended in Italy until June 30, 2026, for most applicable entities”.
Why Italy presses for the split payment extension?
This special measure is part of a package of rules, of which the mandatory electronic invoicing is also part, introduced by Italy to counter tax fraud and evasion.
Italy also considers that, in the absence of the split payment mechanism, the recovery of Vat amounts due from taxable persons engaged in tax fraud or evasion might be impossible to replicate after the cross-check has been carried out because, in the meantime, those taxable persons might have become insolvent.
Thus, the split payment mechanism, as an ex-ante measure, has proved to be highly effective and complementary to mandatory electronic invoicing, which is an ex-post measure. For these reasons Italy has repeatedly asked an extension of the split payment to avoid a setback in the efforts made to reduce the overall difference between the expected Vat revenue and the amount collected.
Nevertheless, to honor its commitment to gradually phase out the special measure, last time Italy modified its request to exclude from the scope of the special measure (split payment), from 1 July 2025, supplies of goods and services to companies listed on the stock exchange that are included in the FTSE MIB index”.
Source: Fisco Oggi
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