Regulatory updates - Italy

The Italian Revenue Agency (Agenzia delle Entrate, AdE) has updated its procedures for closing inactive VAT numbers in a provision issued on October 12, 2026. AdE may close a VAT number on its own initiative if its data indicate that the holder has carried out no business, artistic, or professional activity in the previous three years. This authority is not new; what changes is how AdE identifies and notifies these taxpayers. Key changes are:

• Identification: The new provision changes how AdE identifies inactive VAT numbers. Automated checks now expressly draw on e-invoices, electronic daily receipts, and payments made through voluntary collection, in addition to other Tax Registry data.
• Notification: The provision also changes how taxpayers are notified. AdE will send an advance notice of closure in order of priority. First, it is sent to the taxpayer’s certified email address (PEC). If the VAT holder is not a natural person and has no digital domicile, it is sent to the digital domicile of the taxpayer's representative. If neither is available, it is sent by registered letter to the tax domicile. The notice will also be available in the taxpayer’s tax drawer (cassetto fiscale), and an alert will be available in the taxpayer’s reserved area on the AdE website. For natural persons, a message will also be available in the IO App.
• Closure: The VAT number will be closed on the 60th day following receipt of the preliminary notice or, if delivery is not possible, on the 60th day following the date the notice is made available in the taxpayer’s tax drawer.

A taxpayer who disagrees may object with any local AdE office within 60 days of receiving the notification. After that deadline, they may request reactivation, including supporting reasons. If approved, AdE will reactivate the VAT number and any extinguished tax code retroactively from the original opening date, without interruption.

The provision also introduces a dedicated data-protection section. It states, among other things, that the automated checks do not result in decisions or measures based solely on those checks.

On August 28, 2026, the Italian Revenue Agency (Agenzia delle Entrate, AdE) issued implementing rules for the automated VAT assessment procedure (liquidazione) that applies to omitted annual VAT returns. The procedure was introduced by the 2026 Budget Law, which inserted Article 54-bis.1 into Italian VAT legislation. It covers two situations: where no return is filed, and where a return is filed but reports none of the sales data needed to establish turnover and calculate the VAT due. Both count as omitted.

The automated assessment is based on data the AdE already holds, namely e-invoices issued and received, electronic receipts, periodic VAT communications (Liquidazione Periodica IVA, LIPE), and VAT payments made for the period. The AdE starts from the output VAT in issued e-invoices, electronic receipts, and LIPE filings, then deducts input VAT from received e-invoices and LIPE data along with any VAT already paid for the period. The balance is the amount payable. Any credit shown in the previous year's annual VAT return is excluded from the AdE's calculation.

Where VAT is found to be due, the AdE notifies the taxpayer by certified email (posta elettronica certificata, PEC), or by registered post if PEC delivery fails. The notice and a schedule of the e-invoices and receipts used are also made available in the taxpayer's tax box (cassetto fiscale), accessible from the reserved area on the AdE's website.

Within 60 days of receiving the notice, the taxpayer may flag any data the AdE overlooked or assessed incorrectly and provide supporting explanations. Where the amounts are recalculated in response, a new 60-day period begins from receipt of the revised notice. Alternatively, the taxpayer may pay the amount due within the same 60 days. Receiving the notice removes access to the reduced-penalty regime for voluntarily filing a late return.

Payment within the window reduces the penalty to one-third of the statutory 120% of the VAT due, with interest at 3.5% rather than 4%. Payment must be made using the F24 form, and tax credits or installments may not be used. If the amount remains unpaid after 60 days, the tax, the full penalty, and interest are enrolled directly for definitive collection.

The assessment can be carried out up to December 31 of the seventh year following the year in which the return was due, and it does not prevent a full audit for the same period. Businesses should ensure annual VAT returns are filed on time and that data reported through e-invoicing, electronic receipts, LIPE filings, and VAT payments reconcile.

More details are available in AdE Prot. n. 239129/2026.

The Italian Department of Finance (MEF) has launched a public consultation on a draft legislative decree implementing Article 2 of Directive (EU) 2025/516, part of the VAT in the Digital Age (ViDA) package. ViDA is intended to strengthen EU competitiveness by improving VAT collection, enhancing fraud prevention, and reducing administrative burdens for businesses.

The draft decree covers provisions due to apply from January 1, 2027. It mainly concerns the One-Stop-Shop (OSS) and Import One-Stop-Shop (IOSS) regimes, as well as measures linked to the Single VAT Registration system. The consultation forms part of Italy's process for implementing the ViDA package.

Key measures applicable from 2027

The draft decree mainly addresses OSS, IOSS and related cross-border VAT simplification measures, many of which are relevant to e-commerce. Key changes include:

• Expanding and clarifying the use of OSS and IOSS, including changes to the information businesses must provide when opting into these schemes and the extension of the non-Union OSS to certain services supplied in the EU to non-EU customers.
• Clarifying how OSS and IOSS work in practice, including when VAT becomes payable under OSS, VAT refund rules and how IOSS interacts with small-business VAT rules.
• Clarifying the EUR 10,000 EU-wide threshold for intra-EU distance sales of goods and certain digital services. For businesses registered under the Union OSS, the option to apply VAT in the customer's country would be treated as automatically exercised.
• Phasing out the call-off stock simplification, which currently allows certain stock movements between EU countries to avoid immediate VAT registration. The relevant Italian rules would be repealed from June 30, 2029.
• Clarifying when platforms may be treated as deemed suppliers, meaning when a platform may be treated as the supplier responsible for VAT, on certain intra-EU sales.

Additional changes covered by the draft include transitional rules for certain energy products treated as intra-EU distance sales of goods, as well as directive provisions that do not require changes to Italian domestic law. These measures are intended to simplify cross-border VAT compliance and support more consistent application of VAT rules across the EU single market.

Who is affected

The new rules are relevant for:

• E-commerce businesses that sell goods to customers in other EU countries;
• Businesses using OSS or IOSS to declare and pay VAT through a single EU portal;
• Marketplaces and digital platforms that facilitate sales between sellers and customers;
• Businesses using or affected by IOSS, including sellers of low-value imported goods;
• Businesses moving their own stock between EU countries, particularly those currently relying on call-off stock arrangements; and
• Small businesses and flat-rate taxpayers that may need to understand how the new IOSS and SME VAT rules interact.

For many of these businesses, the way they manage VAT identification, returns, and payments for cross-border transactions may change.

How to participate

The consultation is open to four categories of participants:

• Trade and professional associations;
• Economic operators and professionals;
• Research centers and universities; and
• Private citizens.

The draft decree is published on the MEF’s website, where interested parties may submit comments and proposals via the online form. The consultation is open from June 22, 2026, through July 6, 2026. Feedback may be considered before the decree is finalized ahead of its application on January 1, 2027.