With the delivery of some recent judgements, Italian Tax Courts are dealing again with the institution of “VAT Warehouse”.
Such intervention is certainly useful since over the last years the issue has been the subject-‐ matter of strong interpretative disputes and contradictory jurisprudential decisions.
In particular, the Italian Supreme Court and Tax Commissions have expressed, in more than one occasion, conflicting opinions on the granting of the benefit of “VAT suspension” to activities performed and to goods hold outside VAT Warehouses (even if in adjoining areas).
The Legislator intervened with two different provisions to bring clarity to the issue:
Article 16, paragraph 5 bis, Law no. 2 of 27 January 2009,
Decree Law 179 of 2012,
which are aimed at granting the application of the exemption from VAT payment to services «even if the same are not materially performed in the warehouse itself, but in adjoining premises».
However, the content of the provisions at issue did not achieve the desired effect and, after some sentences in compliance with the spirit clearly delineated by the Legislator, the issue was characterised once again by a certain degree of confusion.
Only recently Tax Commissions seem to have taken a position that one may share (because of its compliance with the provisions of law) in the interpretation and application of the rules.
It may be useful to quote the following statements in principle:
- the suspension of the VAT payment regime is extended «to products not physically placed inside the structure but rather (…) in adjoining spaces, such as ships moored in the sea area bordering the warehouse, which are not placed inside the warehouse for logistic reasons» (The Genoa province tax commission, XIII division, 13 June 2013, no. 64).
- «the physical placement of goods inside the VAT warehouse (…) is not expressly contemplated by any provision of law.» (The Naples province tax commission, XVIII division, 15 May 2013, no. 181/18/13).
- the VAT warehouse regulation «is such that its application is deemed admissible even when goods are not physically placed inside the tax warehouse (…) but deposited in the area in front of the same» (The Genoa province tax commission, XIII division, 28 March 2012, no. 28).
The rulings at issue deserve particular attention:
- not only because they allow, now with a reasonable margin of certainty, to consider as overtaken the confusion generated for years by judgements inconsistent with each other, but also
- because their effects may even extend to neighbouring disciplines, such as those of “tax warehouse” and the regime of suspension of collection of excise duties, with important consequences for all sector operators warehousing or processing goods that are not physically kept within the perimeter of the so called Tax Deposit.
It is milestone, but there is more work to be done, hopefully, with greater calm.