With the introduction of the so-called “Growth Decree” 1, several changes has been adopted by the Italian Government and from a VAT perspective the changes and implications of VAT treatment for electronic marketplaces, now being responsible for VAT submission and liable for the tax due on the distance sales, are the ones that resonates the most.

With the goals of fighting VAT evasion and facilitating compliance in the area of distance selling while looking for collaboration from online platforms who facilitates, the new decree 34/2019 established two important changes to its predecessor (decree 135/2018), namely:

  1. Types of obligation impose to online platforms
  2. Scope of products considered

With regards to the first change, now electronic marketplaces shall submit VAT returns to the tax authority on behalf of the taxpayers (online sellers). The first set of submission should be made by July 2019 and not abiding new regulation should mean electronic marketplaces could be held liable for the tax due on the distance sales, unless they prove that the tax was paid by the supplier. Mentioned submissions are to be made quarterly, within the month following each quarter.

As for the second distinction, it should be noted that, while the provisions of Legislative Decree 135/2018 apply only to distance sales of mobile phones, tablet PCs, laptops and game consoles, those of the DL 34/2019 apply to distance sales of any type of goods, if made through online platforms.

The methods of submission is yet to be defined by the Italian Revenue Agency and these new obligations arose by the “Growth Decree” will apply only until December 31st 2020.

It is important to highlight that this measure does not imply that sellers have to stop submitting their own returns. For sellers nothing will change, but from now on electronic marketplaces will have to submit sellers’ VAT returns as well.