Press Release: Commission disputes legitimacy of Italian tax amnesty on VAT (“condono”)

The European Commission formally asked Italy on 19 October 2004 to amend the VAT chapter of the tax amnesty scheme it has adopted. The contested measure grants taxpayers immunity for previous tax periods in return for a one-off payment exempting them from all administrative controls. No further legal action may be taken against the person concerned even if subsequent proof of irregularities comes to light. The Commission considered that such a blanket and indiscriminate renunciation of controls on VAT and the collection of any additional sums undermined the functioning of the harmonised system and the proper collection of Community own resources. The request was in the form of a reasoned opinion, the second stage of the infringement procedure provided for in Article 226 of the EC Treaty.