According to the Italian Supreme Court, it is not possible to ascertain the existence of a fiscal domicile in Italy for those EU/EEA based companies operating remotely in Italy through online platforms – such as gambling ones, even though there is an Italy-granted license and the offer is aimed for the national market.
Therefore, according to the Supreme Court ruling, online licensees performance does not imply any payment of taxation on revenues.
Putting things into context, an online gambling licensee based in Malta was challenged for fraudulent subtracting to taxation and omitted tax declaration with its Italian bank account provisionally seized.
The Supreme Court denied the fraudulent behaviours of the operator and released the seized account basing its reasoning on the conjunction of the following statements:
- Italian laws on taxation (art. 73 T.U.I.R.), correctly interpreted, state that revenues are not taxable in Italy if the company in question has not even one out of these three requirements: its legal office; its management office; its main business, within Italy for the most important part of the tax period (ex. a fiscal year);
- The concept of main business in Italy cannot be considered as characterized by the online gambling activity of an EU/EEA based company even though addressed to Italian residents and through an Italian gambling license if its online gambling platform is fully managed within another member State of the EU/EEA.
Furthermore, the Court had the opportunity to hold that, according to European Treaty principles on freedom of establishment and services, the fact that a company is established in a member State for the purpose of benefits from a more favorable legislation does not in itself suffice to constitute abuse of the freedom of establishment principle itself.
The Italian Supreme Court recalls that, according to the Italian gambling laws, online gambling licensees are not obliged to have a seat/office in Italy and the gambling license is the toll through which this activity is carried out.
Finally, the Supreme Court correctly applies the Convention for the avoidance of double taxation executed between Italy and Malta in 1981.
Based on the reasoning of the Supreme Court, the scene is settled and makes it even harder to claim taxes on remote services revenues managed abroad (Please refer also to “Google Tax” comment).