tax in Italy

Italian Tax system reform

Over the past years, Italy has been implementing a broad reform of the Italian corporate tax system, with new amendments being introduced annually:

    * Further reduction of corporate income tax rate to 27,5% (from January 1st, 2008)
    * Partial exemption (95%, from 2008 ) of capital gains arising from the disposal of qualified participations into Italian and foreign corporations ("Participation Exemption");
    * Abolishment of the full imputation system on distribution of corporate profits, i.e., the dividend tax credit, and introduction of a 95% exclusion on dividend distributions;
    * Introduction of a joint taxation regime for Italian/foreign corporations belonging to the same group to consolidate their tax base if the parent company is resident in Italy.