Italy Extends Tax Relief, Broadens Scope to More Companies

Italy suspended April and May payments for withholding taxes, value-added tax, and social security tax for companies suffering significant losses during the coronavirus pandemic.

• Under a decree adopted Thursday, the extension is available to companies with revenue of less than 50 million euros ($54 million) whose turnover fell by at least one-third in March compared with March 2019, and businesses with revenue of more than 50 million euros whose turnover fell by at least 50% last month.
• Companies of all sizes with tax bases in the provinces hardest hit by the coronavirus—Bergamo, Brescia, Cremona, Lodi, and Piacenza—are eligible for the VAT payment extensions, regardless of revenue, if they have had turnover losses of at least one-third.
• For eligible companies, payments that were originally due in April and May can be paid either in a lump sum by June 30, or in five installments starting in June without accruing any interest or penalties.
• Similar measures were adopted last month for limited categories of businesses, such as gyms and theaters, that had been forced to close under Italy’s lockdown measures, and for transportation companies managing train stations, bus stations, airports and car rentals.