December 2010

EU Council of Finance Ministers approved new draft legislation reinforcing exchange of tax information for contrasting tax evasion throughout the EU. The directive shall eliminate the banking secret and ultimately starting from 2015 the exchange of information will be automatic in several areas of tax law which fall within the scope of the directive.

Italian tax court ruled against Italian bank on tax abusive transactions involving use of derivative contracts to generate tax credits and double dips. Italian tax administration wishes to rely on the ruling to resolve similar dispute with other banks. The total amount of income that can be recaptured is around three billion with an additional tax in excess of one billion plus interest and penalties. Additional comments on the ruling will follow on our blog