Italy: Decree removes Hong Kong from certain “black lists”

Italy has removed Hong Kong from two of three “black lists.” A ministerial decree in November 2015 removed Hong Kong from the black lists that apply with respect to:

• The Italian controlled foreign corporation (CFC) rules and the full taxation of inbound dividends
• Costs that arise in transactions between Italian residents and a taxpayer in another country that is on the black list (any portion that exceeds the arm’s length amount is not deductible unless a safe harbor rule is satisfied)

Hong Kong remains on the Italian third black list—the one that applies for purposes of reversing the burden of proof when individuals move their tax residence abroad.

Read a December 2015 report [PDF 292 KB] prepared by the KPMG member firm in Italy: Hong Kong has been removed from two of the Italian black lists