The discipline of the tax at issue is to be found in Articles 35 to 52 of Law 145/2018, as modified by the Budget Law.
Pursuant to such Articles, the DST will be due:
- by any Italian or non-Italian entity meeting both of the following conditions, individually or on group basis, during the calendar year preceding the one in which the tax is due:
- total amount of worldwide revenues exceeding € 750 million;
- total amount of taxable revenues obtained in Italy during the relevant financial year from the taxable services (as defined below) exceeding € 5,5 million.
- at 3%, to be paid within the 16 February 2021 for the preceding fiscal year;
- on the total gross revenues (net of value added tax and other indirect taxes) resulting from the provision of the following digital services:
- providing advertising on a digital interface targeted to the users of the same interface;
- providing a multilateral digital interface that enables users to be in contact and interact with each other, also in order to facilitate the direct supply of goods or services;
- transmission of data collected from users and generated by the usage of a digital interface.
Notwithstanding the above definition of digital services, the Budget Law has provided a broad list of services which are not included among those subject to the tax (e.g. the direct supply of goods or services as a part of a digital intermediation service, such as a delivery service provided directly by the owner of the digital interface; financial services, etc.).
The Budget Law has established new territorial nexus rules in order to determine whether the revenues deriving from the digital services shall be taxed in Italy, stating that DST taxable revenues are equal to the percentage of the digital services revenues linked to the Italian territory compared to the worldwide digital revenues realized by the DST taxpayer.
Moreover, the Budget Law has provided some specific nexus parameters for each category of digital services and in particular:
- for the supply of tailored advertising on a digital interface the amount of revenues realised in Italy shall be calculated on the basis of the proportion of the advertising placed on the interface by virtue of data relating to users operating through a device located in Italy;
- for the supply of multilateral digital interface enabling users to be in contact and interact with each other, to facilitate the direct supply of goods or services the amount of revenues realised in Italy shall be calculated on the basis of the proportion of the transactions of delivery of goods or supply of services for which at least one user is located in Italy and, operating on the interface through a device located in Italy, carries out the transaction on such interface;
- for the supply of a multilateral digital interface other than that above the amount of revenues realised in Italy shall be calculated on the basis of the proportion of the users who, through a device located in Italy, opened an account allowing them to access the interface and that used such interface during the fiscal year;
- for the transmission of data collected from users and generated by the usage of a digital interfaces the amount of revenues realised in Italy shall be calculated on the basis of the proportion of the users whose data (sold during the fiscal year) were generated or collected during the consultation of a digital interface through a device located in Italy.
With regard to the formal obligations set by the Budget Law:
- the DST taxpayers must keep a separate accounting of the digital services revenues realised in Italy with respect to each month of the fiscal years in which the DST is due and must submit an annual return of the amount of the taxable services within the 31 March 2021;
- the DST taxpayers which do not already have an Italian VAT number must request an identification code for the purposes of the DST;
- non-UE subjects without a permanent establishment in Italy, which are resident in a State which has not concluded with Italy a convention on tax cooperation, must appoint a tax representative;
- affiliate entities which are tax resident in Italy are jointly liable for the obligations related to the DST due by the foreign DST taxpayer;
- in case of groups, the DST duties shall be complied with by a single duly appointed entity on behalf of the entire group.
Authored by Fulvia Astolfi, Marco Berliri, Serena Pietrosanti, Maria Cristina Conte, and Valerio Natale