Repayment Of Italian VAT Credits To Increase
11 April 2013
Posted by: Author: Ulrika Lomas
Source: Ulrika Lomas
An amount has been added, for the repayment of value added tax (VAT) credits, to the Italian Government's EUR40bn (USD52.4bn) plan to accelerate the liquidation of the large stock of trade debt accumulated by the national, regional and local public administrations.
A decree for the phased repayment of public debt arrears appears to be the only measure that Italian lawmakers can agree upon during the ongoing period of political paralysis caused by the inconclusive general election in February. Even then, the Government has had to commit to monitor actual implementation of the plan and to maintain Italy's fiscal deficit in 2013 under the 3% threshold, in particular through a safeguard mechanism built into the decree enacting the plan.
Under the plan, the Ministry of the Economy and Finance has given the go-ahead for a reimbursement to businesses by the Italian Revenue Agency of a further EUR1.2bn in VAT credits, which would bring to EUR3.7bn the amount approved to be repaid in the first four months of 2013.
In effect, as confirmed recently by the Agency's General Manager, Attilio Befera, in a letter to its regional offices, the objective is to reimburse a total of EUR11bn this year. The offices have been instructed to look at repaying all tax debts to businesses in the shortest time possible, so that, when they are being affected by the current difficult economic situation, firms do not also have to support the financial costs of official unpaid amounts.