Urgent tax measures include revising the domestic CFC rules, tax loss carry-forward provisions, and the penalty protection regime for hybrid mismatch assessments.
Italy’s parliament converted Law Decree No. 84 of 17 June 2025 into law with amendments, through Law No. 108 of 30 July 2025, which was published in Official Gazette No. 177 of 1 August 2025. It introduces urgent tax measures, including updates to domestic controlled foreign company (CFC) rules, adjustments to the carry-forward of tax losses, and revisions to the penalty protection regime for hybrid mismatch assessments.
The hybrid mismatch rules implement the EU Anti-Tax Avoidance Directive (ATAD).
Following recent parliamentary amendments, a 10% additional tax on variable compensations (bonuses and stock options) will only apply to executives in financial intermediaries or financial holding companies, which goes into effect for the 2025 fiscal year.
Law No. 108 of 30 July 2025 took effect on 2 August 2025.
Earlier, Italy’s Ministry of Economy and Finance published Decree No. 84 in Official Gazette No. 138 on 17 June 2025, introducing changes to the CFC rules, the carry-forward of tax losses, and extending the deadline for taxpayers to submit penalty-protection documentation concerning hybrid mismatches.
