The Italian government has proposed additional tax payment extensions and other measures totaling €25 billion to help residents and businesses deal with the COVID-19 pandemic.
A previous €25 billion package, approved by the Council of Ministers on March 15, suspended withholding taxes, VAT, and other tax payments until May 31. Under that program, taxpayers had the option of paying the suspended taxes in their entirety on May 31 or in five monthly installments, without penalties or interest. The government later extended the due date for payment of some taxes until June 30.
On May 14 the Council of Ministers approved a €55 billion COVID-19 stimulus package granting extensions for tax payments until September 16 and canceling the obligation to pay a regional corporate tax (IRAP) for companies with annual sales below €250 million.
On August 7 the Council of Ministers said that under the new measures, taxpayers can choose to pay half of the suspended taxes in a single amount by September 16 or pay in four equal monthly installments, with the first installment due on that date. The remaining 50 percent can be paid in 24 equal monthly installments, with no interest or penalty charges.
The government also said that businesses with activities in economically distressed areas in the southern part of the country can reduce their social contributions by 30 percent from October 1 through the end of the year. “We are aware of the infrastructure deficit in the South, which is less competitive, and we want this gap to be bridged,” said Prime Minister Giuseppe Conte.
Other measures in the new package, which needs parliamentary approval, include tighter restrictions on laying off employees, more liberal unemployment benefits, and “emergency income” payments of up to €400 for low-income families.