Italy Tax Agency Clarifies VAT Regulations for Transactions Involving PE

The Italian Revenue Agency July 24 issued Letter No. 193/2025, clarifying VAT regulations for transactions involving a permanent establishment (PE) located in Italy. The taxpayer, a company established in an EU country, operated a wholesale business through a PE in Italy. The PE handled sales, marketing, and customer support, with products stored in the EU and shipped to customers in Italy. The taxpayer sought clarification on the PE’s VAT obligations for sales and purchases in Italy. The Tax Agency clarified that: 1) VAT obligations depend on the PE’s role in the transactions; 2) the taxpayer must fulfill VAT obligations through ...