Operation (sales of goods and services) put in place starting from September 17, 2011 are subject to the new ordinary VAT rate, increased from 20% to 21%. The correct VAT rate to be applied must be identified according to the moment when the operation/sale can be considered as “preformed” under the VAT general law, different for goods and services. In general:
- Movable goods’ sales are performed when shipped or delivered
- Unmovable goods’ (as real estate properties or buildings) sales are performed when the Notary deed is signed
- Movable and unmovable goods’ sales with constituent effects delayed in respect of shipping, delivering or signature, are performed at the date of effectiveness
- Services’ sales are performed when the price is paid, despite of their partial or total execution.
Therefore:
* Sales performed before the Law Decree effective date will remain subject to the old 20% rate;
* Sales performed starting from the effective date (publication of thenew Law in the Official Gazette) will be subject to the new 21% rate.
For more information, contact our Firm’s International Practice Leader, Tom Breedlove.