Tax in Italy: VAT, income tax, company tax, capital gains

IVA in Italy

EU value-added system; periodic settlements with an annual IVA return.

Standard rate

22%

Local name

IVA — Value Added Tax

Type

VAT

Reduced rates

10%, 5%, 4%

Registration threshold

EUR 85,000 (flat-rate scheme)

Filing

Monthly or quarterly

Authority

Agenzia delle Entrate

Current rate since

1 January 2000

Company tax in Italy

The headline corporate income tax rate is 24%. In effect since 1 January 2026.

Indicative only: confirm with Italy's national tax authority. OECD 2026: central statutory CIT 24%, combined (central+sub-central) 27.81%; sub-central CIT 3.9%

Italy company tax calculator →

Did you know? Italy tax facts

• Until 2017, Italian truffle hunters could legally sell their finds anonymously with no receipt, and truffles were taxed at the full 22% VAT rate.

  After the EU forced Italy's hand via 'EU Pilot 8123/15/TAXU', Law n.122 of 7 July 2016 (Art. 29) cut truffle VAT from 22% to 10% from 1 Jan 2017 and abolished the anonymous 'amateur collector', now requiring hunters to issue a receipt stating quantity, species and harvesting area.

  Source: Villa Magna Tartufi - Truffle Tax Revolution ↗

• Italy was the first EU country to make B2B and B2C electronic invoicing fully mandatory, routing every single domestic invoice through a government platform.

  From 1 January 2019 all domestic invoices must pass through the Agenzia delle Entrate's 'Sistema di Interscambio' (SdI) in FatturaPA XML format, giving the tax authority near-real-time visibility of commercial transactions to fight VAT fraud.

  Source: Sovos - E-invoicing Italy ↗

• Italy's 'tampon tax' has bounced between four different VAT rates in three years - and was actually raised back up after a brief cut.

  VAT on sanitary products went 22% -> 10% (Draghi, 2022) -> 5% (Meloni, 2023) -> back to 10% from January 2024, undoing the headline-grabbing 5% cut after barely a year.

  Source: The Local Italy - Tampon tax: Italy to raise VAT on sanitary products ↗

• Italy has long had one of the largest VAT gaps in the EU - the tax legally owed but never collected hit roughly EUR 35 billion in 2018.

  Italy's VAT gap was about EUR 35.4 billion in 2018, the largest in the EU in nominal terms. Aggressive digitisation (mandatory e-invoicing via SdI from 2019) helped narrow it, but per the European Commission's 2023 country report the gap was still around EUR 25 billion - 15.0% of total VAT liability - keeping Italy among the EU's worst.

  Source: European Commission - Italy VAT gap country report 2023 ↗

• Everyday staples like bread, milk, fruit and vegetables carry a super-reduced 4% VAT in Italy - but the very same food becomes more expensive the moment it is served in a restaurant.

  The 4% super-reduced rate (one of the lowest in the EU, also covering books, e-books and newspapers) explicitly excludes food consumed in restaurants, where the 10% reduced rate applies instead.

  Source: eClear - VAT in Italy ↗

• Italy's IRPEF has had three brackets since 2025 — 23% up to €28,000, 35% to €50,000 and 43% above — plus regional surcharges of 0.7% to 3.33% and municipal surcharges of up to 0.9% on top.

  Wikipedia: under Law n. 207/2024 the 2025 brackets are 23% for €0–€28,000, 35% for €28,000–€50,000 and 43% 'over €50,000'; regions can add 'an additional 0.7 percent to 3.33 percent' and municipalities 'from 0.1 percent to 0.9 percent'.

  Source: Wikipedia — Taxation in Italy · checked 10 October 2026 ↗

• Italian companies pay two profit taxes: IRES at 24% to the state, plus the regional IRAP at a standard 3.9% that each region may adjust by up to 0.92 points.

  Wikipedia: Italy's corporate tax rate is 'currently at 24 percent'; the standard IRAP rate is '3.9 percent', adjustable by regional authorities by up to 0.92 percent.

  Source: Wikipedia — Taxation in Italy · checked 10 October 2026 ↗

More stories, for every country that has one, on the tax facts page.