Italy Tax Agency Clarifies PEX, Privileged Tax Regimes

The Italian Revenue Agency Sept. 27 issued Letter No. 481/2022, clarifying the 95 percent participation exemption (PEX) regime and privileged tax regimes. A taxpayer underwent a reverse merger with its parent company and acquired an American subsidiary. The subsidiary made a dividend distribution and liquidated. The taxpayer inquired as to the resulting tax consequences and the application of the PEX regime. The agency clarified that: 1) for ordinary liquidations, the three-year observation period for the commercial requirement should be reviewed from the beginning of the liquidation of the related company; 2) if the subsidiary wasn’t considered subject to a privileged ...