Italy Tax Agency Clarifies Tax Obligations of German PE for Qualifying VAT Transactions

The Italian Revenue Agency Feb. 13 issued Answer No. 33/2025, clarifying the obligations of a German permanent establishment (PE) for qualifying VAT transactions. The taxpayer, a German parent company, operated through a PE in Italy, which provided auxiliary and support activities such as managing customer interactions, negotiating prices, processing orders, communicating with suppliers, and providing logistical support. The taxpayer sought clarification about the PE’s VAT obligations and who could apply for VAT refunds. The Tax Agency clarified that: 1) the PE’s activities with respect to the customers, including contract support, order fulfillment, and post-supply assistance, qualify as significant involvement in ...