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📘 2024 Tax Updates: Details and Implications of the Latest VAT, IVAFE, and Stamp Duty Directives

Introduction

In the context of regulatory transformations affecting the Italian tax landscape, the Revenue Agency has issued Circular No. 3 of February 16, 2024.


Agenzia Entrate - circolare n3 del 16-02-2024
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This document marks the introduction of significant novelties for the current fiscal year, examining the main changes and their potential repercussions on taxpayers, with a special focus on VAT, IVAFE (Foreign Financial Assets Tax), and stamp duty as outlined by both the 2024 Budget Law and the Advance Decree.


🔍 VAT: Updates and Noteworthy Changes

Among the most impactful novelties are the VAT changes, which include variations in the rates applied to specific products.

Notably, products dedicated to children and feminine hygiene undergo a VAT rate revision, with some items increasing from 5% to 10%, marking the return of the so-called tampon tax.

This change affects sanitary pads, tampons, menstrual cups, as well as powdered or liquid infant milk, flour-based foods, and diapers. Concurrently, the VAT on child car seats is increased to 22%.

The Budget Law also introduces a reduction in the threshold for tax-free shopping, setting a minimum limit of 70 euros for the application of VAT exemption for tourists, effective from January 1, 2024.


🌐 Focus on IVAFE: Increase in the Tax for Financial Products

Attention also shifts to IVAFE (Imposta sul Valore delle Attività Finanziarie detenute all'Estero, Tax on the Value of Financial Assets held Abroad), with the introduction of a tax increase to 0.4 percent for financial products held in states or territories with privileged tax regimes.

This increase, specified in Article 1, Paragraph 91, of the 2024 Budget Law, does not affect financial products in countries not considered tax havens, for which the rate of 0.2 percent remains.

The circular clarifies, explicitly excluding Switzerland from the list of states with privileged tax regimes, thus maintaining the reduced rate of 0.2 percent for assets held there.


🏠 Stamp Duty: New Features and Facilitations

Regarding stamp duty, significant innovations emerge, particularly the exemption from payment for the adjustment of statutes of amateur sports associations, extended until June 30, 2024.

Additionally, new provisions related to the first-home bonus for Italians residing abroad for work reasons are introduced, allowing the application of a reduced rate of 2% under specific conditions, including previous residency in Italy for at least five years.


 

🕒 What are the main novelties introduced by the 2024 Budget Law regarding the Italian tax system?

The 2024 Budget Law introduces significant changes in the Italian tax landscape, including the update of VAT rates for certain goods, the increase of IVAFE for financial products in states with privileged tax regimes, and innovations for stamp duty, aiming to positively influence both individual taxpayers and businesses.


🕒 How do the VAT rates vary following the new 2024 directives?

VAT rates will see significant variations in 2024: for certain products dedicated to children and feminine hygiene, rates will increase from 5% to 10%, reintroducing the so-called "tampon tax".

Moreover, the VAT applied to child car seats will be increased to 22%, while the limit for tax-free shopping for tourists will be reduced to 70 euros.


🕒 What updates have been made to IVAFE, and what impacts will they have on taxpayers?

IVAFE will see an increase in the rate to 0.4 percent for financial products held in states or territories considered to have privileged tax regimes.

This change aims to balance the tax treatment of financial products, maintaining the rate of 0.2 percent for assets in countries not classified as tax havens, and aims to encourage financial transparency.


🕒 How has the stamp duty been modified in the 2024 Budget Law, and what benefits does it bring to citizens?

The 2024 Budget Law introduces significant innovations for stamp duty, including exemption from payment for the adjustment of statutes of amateur sports associations until June 30, 2024.

It also extends the first-home bonus to Italians residing abroad for work reasons, applying a reduced rate of 2% under specific conditions, such as prior residency in Italy for at least five years.

These measures are designed to support both sports activities and facilitate access to first homes.

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