EATLP Annual Congress 2018 - Tax Transparency - National Report (Italy)

The knowledge of the taxable event and the identity of the taxpayer is the first and inevitable precondition of an efficient and comprehensive tax enforcement. The taxpayer has to be transparent towards the tax administration to the extent data are relevant for the assessment and collection of taxes. Therefore, generally speaking, the collection of information by the tax authorities is of public interest. However, we seem to experience a paradigm shift. In recent years significant losses of tax revenue caused by aggressive tax planning triggered a worldwide claim for increased tax transparency. In the OECD BEPS project transparency became one pivotal element of tackling base erosion and profit shifting. At the same time digitalization allows for a totally new utilization of the received information. This development raises concerns that the tax administration might turn into an appetent "data octopus", collecting information from everywhere with its long arms and not always limited to what is inevitably necessary for the mere tax assessment and collection. Hence, there is a need for a discussion about the chances of enhanced transparency as well as about risks and boundaries. Data collection has to be proportional to the tax enforcement. The collection of information by the tax authorities is never a goal in itself but has to be limited to the extent the data is indispensable for the collection of taxes legally due. Not only the duty to pay taxes but also the duty to provide information on private and business data and to tolerate the collection of data also from third parties by the fiscal authorities interferes with fundamental rights. Big data in the hand of the tax authorities might be secured by the tax secret. However, there is a growing risk of data abuses. Accordingly, it is the tax administration’s responsibility to ensure a sufficient legal environment for processing, storing, using and sharing the data collected. This does not only concern questions of the legal and administrative environment but also technical issues. A self-restriction in the collection of data is also in the own interest of the tax administration as a thicket of data causes costs without significant value and makes it difficult to trace the right sort of information.