VATupdate

VAT rates in Italy

Quick overview

Standard Rate Other Rates
22% 5%, 10% and 4%

The local name for VAT in Italy is Imposta sul valore aggiunto (IVA).

Recently, we saw some updates in Italy about the 10% rate for urbanization works, the rate applicable to supplies of vegetable oils used to generate electricity, and the 4% rate for non-stuffed gnocchi with a minimum percentage of speck.  Also, Italy announced they would not proceed with a VAT increase in 2021. For more information about (recent) rate change developments in Italy, please click here.

Standard rate: 22%

This is in place since 1 October 2013.  Before that, the standard rate was 21%. This rate applies for all transactions that take place in Italy, unless an exception applies (such as a reduced rate, the zero rate or an exemption, or a reason to treat the transaction as outside scope of VAT).  Please note that the following territories are excluded from the scope of VAT: Livigno, Campione d’Italia and the territorial waters of Lake Lugano.

Zero rate (0%)

Italy applies various exemptions with a refund of tax paid at preceding stages (zero rates), such as intra-Community and international transport, intra-Community supplies of goods, exports of goods (and related services) to non-EU countries, sea vessels and aircraft and related goods/services, and services to goods and goods under customs control.

Reduced rate 1: 5%

Examples of transactions subject to this rate are:

  • Supplies of fresh basil, rosemary, sage, oregano, fresh or chilled truffles.
  • Products for feminine sanitary protection which are compostable or washable and menstrual cup.
  • Supplies of urban passenger transport by means of vessels authorised to perform transport by sea and inland waterways (lake, river and lagoon), (L. no. 232/2016 article 1, par. 33)
  • For certain health and social services provided to elderly people, adults suffering from occupational injuries and diseases, drug addicts, people living with AIDS, people suffering from mental or physical disabilities, minors even where involved in situations of maladjustment and deviancy, homeless asylum-seekers, inmates, women who are victims of trafficking for the purpose of sexual and labour exploitation.

Reduced rate 2: 10%

Examples of transactions subject to this rate are:

  • Frozen, dried or preserved truffles dipped in salt water, sulphured water or water with other substances suitable for temporary preservation, but not prepared for immediate consumption.
  • Water supplies
  • Medicines for human and veterinary use, including homeopathic products; pharmaceutical substances and medication items the provision of which is compulsory for pharmacies in accordance with the official pharmacopoeia.
  • Rail and Road transport can be exempted or subject to 10%
  • Admission to cultural services (shows, cinema, theatre)
  • Renovation and repairing of private dwellings
  • Hotel accommodation
  • Restaurant and catering services
  • Admission to (certain) sporting events
  • Collection of domestic waste and street cleaning, other than the supply of such services by bodies referred to in Article 13 of the Directive 2006/112/EC

Super-reduced rate: 4%

Examples of transactions subject to this rate are:

  • Certain foodstuffs
  • Orthopaedic instruments (including medical-surgical belts); devices and equipment for fractures (showers, slats and the like); devices and instruments for dentures, eyes and others; hearing aids and other hand held equipment to be carried by persons or to be inserted in the entity, to compensate for a deficiency or a disability; chairs and similar vehicles for the disabled, gas for therapeutic use; artificial kidneys; parts, spare parts and accessories intended exclusively for the goods mentioned above.
  • 4% to newspapers and news magazines, dispatches from the press agencies, books, periodicals, Braille writings and audio-magnetic media for the blind and the visually impaired, e-books and all digital publications as newspapers, newsletters, periodicals, etc. which are issued by an electronic means and have an IBSN (International Standard Book Number) or ISSN (International Standard Serial Number); with the exclusion of pornographic newspapers and periodicals and catalogues different from those in the information library; printed music editions, printed maps, including printed globes.
  • E-books which have an IBSN (International Standard Book Number).
  • TV licence
  • Non-luxury housing in accordance with the criteria set forth by Decree of the Minister of Public Works Nº 218 of 2 August 1969.

For a description of how the VAT rates are structured in the European Union, please see here.  The European Commission has also made an EU VAT rate database available where you can find the applicable VAT rate by entering the CN/CPA code of the goods respectively services (you can find more information here).

A global VAT/GST rate overview can be found here (note this is a work in progress).

This post was last updated on 10 April 2021.

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