TAX ALERT 2020/04

In order to face the current epidemiological emergency, Law Decree 17 March  2020, n. 18 (the “Decree”) provided for two different suspension periods of deadlines that may influence the activities of the Italian Tax Agency. The first one is laid down in Art. 67 that sets a suspension of the activities of the Tax Agency from 8 March to 31 May 2020 - for a total of 85 days. The second one is laid down in Art. 83 and provides for a suspension of the procedural (judicial) deadlines from 9 March to 15 April 2020 - for a total of 38 days.

The circumstance that the Decree provided for two different suspension periods  generated interpretative uncertainties with reference to the computation of deadlines applicable in case of so called “tax settlement” (accertamento con adesione) procedures.

The issue materializes since the first suspension, i.e. the one of 85 days laid down in Art. 67 deals with, inter alia, the functions exercised by the Tax Agency with reference to assessment activities. Being a tax settlement procedure part of this activity one could argue that the suspension period for tax settlement procedures was regulated by the aforementioned Art. 67. On the same time, also the second suspension of 38 days laid down by Art. 83 and involving procedural (judicial) deadlines could shed its effect on tax settlement procedures since such procedure provides for a 90-day suspension period of judicial deadlines. In fact, taking into consideration that under a tax settlement procedure the deadline to appeal the deed of assessment in case an agreement is not reached expires in a 150-day (ie 60+90 days) period, the two provisions may look to be in contradiction one another.

The Italian Tax Agency on 23 March 2020 issued Circular Letter No. 6/E (the “Circular”) dealing with the specific issue stating that:

• the suspension from 8 March to 31 May 2020 laid down in Art. 67 is not addressed to taxpayers but only to the Tax Agency and is meant to facilitate functions the public officers extending the deadlines for the liquidation of taxes, audit, assessment and collection activities. This extension is not to be interpreted as a lock-down of the activity of the Tax Agency so that – to the extent possible and without soliciting physical movements of tax officials and taxpayers – the Tax Agency must keep to the exercise its functions so that this provision shall not be read as preventing tax settlement procedures;
• the procedural suspension from 9 March to 15 April 2020 laid down in Art. 83 postponing the deadlines within which a taxpayer is entitled to appeal against a deed of assessment, is apt to shed its effect on tax settlement procedures as follows:
  1. deeds of assessment served before 9 March 2020: in this case the 150-day deadline (ie 90 + 60 days) to appeal against a deed of assessment is suspended from 9 March to 15 April 2020. The deadline will start to elapse again as from 16 April 2020 (for instance, the deadline to appeal a deed of assessment served on 20 December 2019 for which a taxpayer filed a request to settle the case under a tax settlement procedure, will expire on 25 June 2020);
  2. deeds of  assessment served from 9 March 2020 to 15 April 2020: in this case the 150-day deadline to appeal a deed of assessment will start to run as from 16 April 2020 (so that for any deed of assessment served in the period 9 March 2020 to 15 April 2020 for which a taxpayer filed a request to settle the case under a tax settlement procedure will expire on 13 October 2020. In fact one should conclude that, notwithstanding the fact that the Circular does not deal with this issue, the “holiday suspension” of legal deadlines running from 1 August to 31 August every year should be still applicable).

In this context, the Circular indicates that, since the activity of the offices towards taxpayers is not suspended, the Tax Agency must in any case guarantee that the consultations with taxpayers that have to be performed under a tax settlement procedure should – to the extent possible – not be stopped, although, given the epidemiological emergency, they have to take place “remotely” through electronic means (i.e. calls, videocalls and exchanges of certified emails).

Finally, the Circular concludes that the twenty-day deadline within which taxpayers must execute the payment of the settled amount (in full or the first installment), such deadline starting to elapse as from the day in which the tax settlement agreement is signed, is not suspended by any provision of the Decree so that it must be observed in order for the tax settlement to be enforceable.