- Italy’s Leadership in Digital VAT: Italy has been a pioneer in digital VAT reporting, implementing mandatory e-invoicing through its Sistema di Interscambio (SDL) platform since 2014. This system has significantly improved transparency, reduced tax evasion, and streamlined administrative processes, serving as a model for other EU countries as they prepare for the EU’s VAT in the Digital Age (ViDA) legislative package.
- ViDA Legislative Package Overview: The ViDA package, effective from April 2025, aims to harmonize VAT administration across the EU by introducing mandatory digital reporting requirements and standardized e-invoicing for cross-border transactions. This initiative is designed to enhance real-time data collection, reduce fraud, and simplify compliance for businesses operating within the EU.
- Comprehensive Approach and Future Implications: Italy’s inclusive approach to digital VAT reporting, which includes small businesses and non-profits, has led to more efficient data capture and reduced compliance costs. As the EU moves towards full implementation of the ViDA package by 2035, Italy’s experience provides valuable insights into the benefits of early adoption and comprehensive reform in achieving effective digital tax governance across Europe.
Source IBFD
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