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Italy imposes marketplace VAT fraud obligations


Italy is making online marketplaces the deemed supplier and VAT principal on B2C sales below €150 by non-EU third party sellers. The measure will apply to consumer electronics, such as mobile phones, video games, tablets, games consols etc. It covers imports from non-EU, third countries.

Instead of the non-EU seller being responsible for VAT reporting under distance selling or import rules, the market place will first acquire the goods from the seller as a B2B, nil-rated transaction, and then provide a local sale to the consumer with Italian VAT. The marketplace will then be responsible for charging, collecting and remitting VAT to the Italian tax authorities.

Non-EU sellers affected must still appoint a local representative in Italy.

The Italian law change mirrors a 2021 proposal by the European Commission, and appears to be in advance of this proposal being adopted into the EU VAT Directive.  This would put into question this derivation into question.  Whilst the implementing law was gazetted on 12 February, it is not yet clear when it will be enforced.


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Italy imposes marketplace VAT fraud obligations

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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.
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