Foreigners in Italy hit by tax changes

Foreigners in Italy will be forced to disclose more information about their overseas assets as part of tax rule changes that will also see authorities monitoring transactions more closely.

Foreigners in Italy hit by tax changes
Photo: Alan Cleaver/Flickr

Foreigners will now have to declare all assets, which would usually include property, shares and savings accounts, regardless of their value, after the €10,000 threshold was scrapped.

Though they won't be charged any extra tax on smaller assets, they face stiff penalties for failing to declare the assets and will likely have to undergo more cumbersome reporting procedures, Gareth Horsfall, a financial planner at Spectrum IFA Group in Rome, told The Local.

“A new internal team of the Guardia di Finanza (finance police) has also been set up to monitor transactions taking place abroad for Italian residents,” Horsfall said.

“This is in line with European and G20 guidelines regarding a free share of tax and financial information.”

In 2012, Italy introduced new taxes on foreigners who have homes overseas (0.76 percent on the rateable value if the property is in Europe and on the market value if it is outside Europe). In addition, they are also taxed on non-property foreign assets at a rate of 0.15 percent, Horsfall said.

Still, foreigners will get some relief after IMU, the controversial property tax, was scrapped in August. It will be replaced next year with a service charge, which is expected to include all local taxes such as waste collection.

“From 2014, it will no longer be the IMU we have known so far,” Italian Prime Minister Enrico Letta said in August.

“It will have a new name, TASER or tax on municipal services.” 

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Italy’s Renzi wants ex-ECB boss Draghi to become prime minister: report

Ex-PM Matteo Renzi would like to see former European Central Bank chief Mario Draghi become prime minister of Italy, a party source told Reuters on Sunday.

Italy's Renzi wants ex-ECB boss Draghi to become prime minister: report
Matteo Renzi. Image: Andreas Solaro/ POOL / AFP

“I would say that is one of our proposals,” confirmed the source, who declined to be named.

The Italian government collapsed last week when PM Giuseppe Conte resigned. The former coalition allies are currently trying to come to an agreement and sort out their differences.

The centre-left government had been in turmoil ever since former premier Matteo Renzi withdrew his Italia Viva party earlier this month, a move that forced Conte to step down this week.

During the past year, Renzi frequently criticised Conte’s management of the pandemic and economic crisis.

Italy’s La Stampa newspaper also reported on Sunday that President Sergio Mattarella was considering Draghi for the prime ministerial role. However, Mattarella’s office promptly denied this, saying there had been no contact between them.

So far, there has been no comment from Draghi, who hasn't been seen much in the public eye since 2019.

Italy's president, Sergio Mattarella, gave ruling parties more time on Friday to form a new government, after the resignation of Prime Minister Giuseppe Conte. 

Coalition parties Italia Viva, the centre-left Democratic Party (PD) and anti-establishment 5-Star Movement must come to an agreement to allow the government to heal. 

Renzi, a former prime minister himself, has pubilcly stated that he does not want to talk about who should lead the next government at this stage, reasoning that the parties need to agree on a way forward first.

“Any effort today to fuel a discussion about Draghi is offensive to Draghi and above all to the president of the republic,” Renzi said in an interview published on Sunday with Corriere della Sera.

A senior Italia Viva lawmaker also told Reuters that “If the president gives a mandate to Draghi, we would certainly support this”. 

Renzi, whose party is not even registering three percent support in opinion polls, quit the coalition over Conte’s handling of the COVID-19 pandemic and his plans for spending more than 200 billion euros from a European Union fund to help Italy’s damaged economy.

READ ALSO: Why do Italy's governments collapse so often?