Italy: VAT-Exemption For The Supply Of Goods And Services To Employees Of International Bodies And Organizations

By Ruling no. 495 of October 5^th, 2022, the Italian Revenue Agency accepted a request for VAT refund submitted by an employee (official) of an international body not established in Italy concerning the purchases of goods for personal use effected in Italy. The official answer was grounded on the exemption regime set forth, under conditions of reciprocity, by Article 151 of Directive 2006/112/EC (the so-called “VAT Directive”) for the supply of such goods.

The applicant's request was supported by the filing of the appropriate certificate, issued by the competent authorities of the EU Member State hosting the international body, attesting the requirements for the VAT exemption.

Under Article 151, paragraph 1, letter b) of the VAT Directive, the following are indeed exempt: “the supply of goods or services to international bodies (…) of the host Member States, and to members of such bodies, within the limits and under the conditions laid down set by the international conventions establishing the bodies or by headquarters agreements“.

The domestic Italian VAT legislation provides for the same exemption under Article 72, paragraph 1, letter f) of Presidential Decree No. 633/1972.

The regulatory framework is completed by Article 51 of the implementing Regulation (EU) no. 282/2011, according to which the exemption regime is subject to the issuance of a special certificate by the competent authorities of the EU Member State in which the applicant is established (so-called “VAT exemption certificate”).

In other words, the competent authorities of the EU Member State hosting the international body shall have to assess the entitlement of the VAT exemptions and, where appropriate, issue the exemption certificate, or grant the exemption in accordance with the aforementioned Regulation No. 282/2011.

In the case at hand, on the basis of the above, once the Revenue Agency had ascertained that the exemption certificate produced by the applicant was in compliance with the provisions of the Regulation No. 282/2011, deemed the purchases of goods for personal use made in Italy to be eligible for the VAT benefit and, therefore, accepted the refund request submitted by the applicant.

This answer integrates the previous official clarifications provided by Ruling no. 45/2021, in which the Revenue Agency had already commented on the VAT regime applicable to supplies of goods and services effected by international bodies and organizations.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.