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Italy delays 1% VAT rise until 1 October 2013

  • VAT
  • 26 June 2013 | Richard Asquith

Italy delays 1% VAT rise until 1 October 2013

On Wednesday 26 June, the Italian Cabinet agreed to delay the proposed 1 July Italian VAT rise from 21% to 22%.  This follows intense political discussions between the various political parties of the new coalition government.

The rise was due to raise €4 billion per annum, and contribute towards Italy’s aim of bringing it budget deficit down to the Euro currency zone target of 3%.  This three month delay will cost over €1 billion in lost revenues.

The rise was originally proposed in 2012 during attacks on the Euro and Italian government lending rates by finance markets concerned about Italy’s excessive debt pile.  It followed an earlier rise in Italian VAT of 1% to 22% in September 2011.

The Italian Parliament must now debate the rise.  It is quite probable that this rise will be further delayed, or even cancelled given to fragile state of the Italian economy which is stuck in recession.  Check all EU VAT rates here.


VP Global Indirect Tax
Richard Asquith
VP Global Indirect Tax Richard Asquith
Richard Asquith is VP Global Indirect Tax at Avalara, helping businesses understand their compliance obligations as they grow globally. He is part of the European leadership team which this year won International Tax Review's Tax Technology Firm of the Year. Richard qualified as an accountant with KPMG in the UK, and went on to work in Hungary, Russia and France with EY.