Eligible businesses will be able to defer to June payments of withholding tax, value-added tax and employee withholding taxes due in April and May depending on the size of the business and the amount of loss in revenue.
Enterprises making more than €50 million ($54.6 million) are entitled to defer payments if they suffer a revenue loss of more than 50% compared with March and April of last year. Enterprises making less than €50 million can defer payments for losses exceeding 33%.
In the northern Italian provinces of Bergamo, Brescia, Cremona, Lodi and Piacenza — where the novel coronavirus has taken an especially harsh toll — businesses suffering losses of more than 33% can defer payments regardless of their yearly revenue intake.
A business's year-to-year decrease in turnover will be subject to verification by the Italian Revenue Agency, according to the decree. Payments can be made in June all at once or in up to five monthly installments starting in June.
Other benefits in the relief package include the partial suspension of penalties for underpayments of individual and corporate income taxes. For a business or individual to qualify, payments must have been scheduled to be made in installments, and the amount of the underpayment must not be less than 80% of what a taxpayer owes.
A previously implemented 50% tax credit against the cost of sanitizing workplaces has been expanded to cover the cost of purchasing protective equipment for the workplace. Businesses can claim the sanitation and equipment credit on up to €20,000 in costs.
The tax measures are part of a larger package approved Monday designed to provide cash-strapped businesses with over €400 billion in state-guaranteed loans. The Italian government estimates 90% of all businesses will be able to benefit from the loans.
A spokesperson for Italy's Ministry of Finance did not immediately respond to requests for comment.
Italy has one of the world's highest rates of death and illness from COVID-19, the disease caused by the novel coronavirus. As of Thursday, there were 139,422 confirmed cases, and 17,669 deaths, according to the World Health Organization.
--Editing by Vincent Sherry.
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