The Italian Parliament has converted Law Decree n. 34 (the 'Growth Decree') into Law n. 58 with amendments, with effect from 30th June 2019.
This introduced a range of provisions for short term rental properties, including:
- Continued liability to pay the flat tax (21%) on short-term rentals
- Introduction of a database of all short term rental properties
- Use of identification codes for each property which must be published alongside adverts
- A requirement to communicate data to the state police
The aim of these provisions is to stem the problem of tax evasion in the tourist property rental sector by introducing new tax reporting obligations for short term rentals, especially for rental contracts through agencies and online portals such as Airbnb. The database, identification code and requirement to communicate data aim to create a more transparent tax system for short term rentals.
The 21% tax applies only if both the landlord and tenant are acting as private individuals and where an intermediary is used.
Where an intermediary is used, it should collect the tax and pay it to the Fiscal Authority. Airbnb has challenged this provision claiming not to be an intermediary, but only a website manager. This challenge was referred to the European Court on 18th September 2019.
The new law sets up a database of all short term rental properties (30 days or less) present on Italian territory. The properties are identified through an identification code. This code must be used in any communication related to the advertisement and promotion of such properties.
The new law has also introduced an obligation to publish the identification code with all communications and promotions of relevant properties. This is the responsibility of:
- The owners of the accommodation; or
- The relevant intermediary; and
- The entities that manage web portals
There is an administrative penalty of Eur 500 to Eur 5,000 for violation of this law.
Communication of Data
The owners of relevant properties must communicate data relating to the tenants of short term rental properties to the state police. To do so, the relevant owner must visit their local police headquarters and request access to Allogiati, the online portal for submission of guest information. This data will in turn be communicated to the Revenue Agency (IRS) to verify the payment of taxes.