Italy Publishes the New White List for Tax Purposes

2016 August: On 22 August 2016 the Italian Government added 51 new jurisdictions to the list of jurisdictions that it considers allow an adequate exchange of information for tax purposes with Italy (the so called “white list”). It is also providing a broad range of tax benefits to tax payers resident or established in the listed jurisdictions.

The Cook Islands signed a Tax Information Exchange Agreement with Italy in 2011 which came into force in February 2015. It is currently regarded as cooperative with Italian exchange of information requirements and is on the white list. The most recent additions to the white list include Switzerland, Jersey, Liechtenstein, British Virgin Islands and Hong Kong.

It is expected the amended white list and tax benefits will significantly increase the appeal of investing into Italy for investors from white list jurisdictions and should simplify enormously the structuring of inbound investment.

Investors resident or established in white list jurisdictions will enjoy a wide range of tax benefits on Italian source income such as full exemption at the source on:

  • Interest and capital gains on bonds and similar securities;
  • Interest and capital gains on loans (subject to certain conditions);
  • Proceeds and gains from Italian investment funds, including real estate funds;
  • Proceeds from derivatives including repos and securities lending;
  • Capital gains on shares and participating instruments representing “non-qualified” participations.

The Italian Ministry of Finance reserves the right to test the actual compliance of each white list jurisdiction with the exchange of information obligation and to remove from the list any uncooperative jurisdictions. Under Italian law the white list has to be updated every six months.