Executive summary

On 29 December 2017, Italy published the Budget Law of 2018 (the Law) in the Italian Official Journal and, among other measures, the Law introduces the following new provisions regarding certain energy products held in tax warehouses or at registered consignees:

• The methods of payment of Value Added Tax (VAT) in the case of certain energy products released for consumption from a tax warehouse (i.e., a warehouse authorized for the excise duty suspension regime) or extracted from a warehouse of a registered consignee
• The requirement of an authorization from the Customs Authority in order to store energy products in a third-party tax warehouse or a warehouse of a registered consignee

Detailed discussion

Release for consumption of certain energy products from a tax warehouse or extraction from a warehouse of a registered consignee

With respect to the petrol or diesel fuel intended for use as motor fuel as well as other fuels that will be identified by a decree of the Italian Economy and Finance Ministry, stored in a tax warehouse or in a warehouse of a registered consignee, the Law set forth that:

• The release for consumption from the tax warehouse or the removal from the warehouse of the registered consignee must be preceded by the payment of the VAT through form F24 by the subject on behalf of which the goods are released for consumption or removed from the aforementioned warehouses.
• VAT payment through offsetting with VAT or other taxes credits is not allowed.
• The receipt of VAT payment is provided to the warehouse manager before goods are released for consumption or removed; in the absence of such receipt, the warehouse manager is jointly responsible for the VAT not paid.
• The VAT taxable base, which includes the amount of the excise duties, is the amount or value of the goods at the time of the introduction or the amount or value of the last sale done during their storage in the warehouse; this tax base is increased by the amount of services performed on the energy products stored in the warehouse, if any.
• The reference data of form F24 must be noted on the administrative simplified accompanying document of the goods released for consumption or removed from the mentioned warehouses.
• Sales of such products carried out inside the tax warehouse or the warehouse of the registered consignee are not subject to VAT.

The above provisions do not apply in the following circumstances:

• If the above-mentioned products are owned by the warehouse manager from which they are released for consumption or by the registered consignee who removes those products.
• If products are released for consumption or extracted from the warehouse on behalf of another tax warehouse manager, holder of a different tax warehouse with a capacity not less than 400 m3 for liquefied petroleum gas and of 10,000 m3 for other energy products and which complies with the reliability criteria established by the decree that the Italian Economy and Finance Ministry shall issue within 30 days from the entry into force of the Italian Budget law of 2018, i.e., 31 January 2018.
• If such products are released for consumption from a bonded warehouse with a capacity of not less than 400 m3 for liquefied petroleum gas and of 10,000 m3 for other energy products on behalf of a person who provides for an appropriate guarantee in the manner and terms established by the aforementioned decree.

The aforementioned changes will also be applicable when the tax warehouse is used as a VAT warehouse, except where the release for consumption is carried out on behalf of a subject who meets the reliability criteria that will be established by the mentioned decree or who provides a proper guarantee with the methods and terms established by the same decree.

These provisions enter into force 1 January 2018 but they are effective from 1 February 2018 upon the issuance of the implementing decree.

Authorization to store energy products in a third-party warehouse

The Law also introduces the obligation to request authorization from the Customs Authority in order to store energy products in third-party tax warehouses or in the warehouse of a registered consignee.

For economic operators, who are also tax warehouse manager of energy products in Italy, the aforementioned authorization is replaced by a communication, with annual validity, to be transmitted to the Customs Authority before the first storage of the goods.

The infringement of the aforementioned fulfilment is subject to an administrative penalty from €1,000 to 10,000.

These provisions enter into force 60 days after the publication of the implementing procedures related to the aforementioned authorization and communication to be defined by a decree of the Italian Economy and Finance Ministry within 60 days after the entry into force of the Budget Law 2018, i.e., 2 March 2018.

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CONTACTS

For additional information with respect to this Alert, please contact the following:

Studio Legale Tributario, Rome

• Nicoletta Mazzitelli
  nicoletta.mazzitelli@it.ey.com
• Stefano Pavesi
  stefano.pavesi@it.ey.com
• Andrea Primerano
  andrea.primerano@it.ey.com

Studio Legale Tributario, Turin

• Anna Paola Deiana
  anna-paola.deiana@it.ey.com

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ATTACHMENT

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