Home » Tax reform: gradual farewell to IRAP and revision of IRES

Tax reform: gradual farewell to IRAP and revision of IRES

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The guiding criterion for eliminating these differences is constituted by the introduction of a “separate” taxation mechanism, and at a proportional rate, of business income regardless of the subject (IRES or Irpef) that produces it. This mechanism will also serve to avoid (further principle of the reform) that the legal form of the company is chosen only on the basis of the lower tax burden.

The precedent of 2017

A similar system, we recall, has already been proposed in the past, but has never actually been applied. The 2017 Budget Law introduced an optional flat tax regime (with a rate equal to that of the IRES, i.e. 24%) for the income of sole proprietorships and partnerships (Snc and Sas), the so-called Iri, but the the rule was repealed two years later (by the 2019 Budget Law) without ever having entered into force.

The income subject to Iri would then have had to undergo the tax adjustment at a progressive Irpef rate only at the time of its eventual distribution to the entrepreneur or to the shareholders, in a similar way to what happens for the Srl and the Spa.

The taxation mechanism that had been envisaged at the time was characterized by an extreme application complexity that risked making it unattractive. It is therefore desirable that, also in order to respect the other inspiring principles of the reform, the future separate taxation of corporate income is characterized by clear and simple rules.

A second principle that must inspire the revision of the taxation of companies and corporations (IRES) concerns the simplification and mitigation of administrative obligations, to be implemented by aligning the tax values ​​(and therefore the quantification of the relevant costs and income in tax area) to accounting and financial statements. The reduction of the differences must concern in particular, the delegated bill specifies, depreciation.

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