Trattati fiscali italiani e limiti quantitativi del Foreign Tax Credit

This paper focuses on the foreign tax credit quantitative limitations under the Italian double taxation conventions in comparison with the OCDE Model and the United Nations Model 2017 (articles 23 A, 2° par, and 23 B). The analysis starts with the identification of some special clauses present in this network of conventions. Indeed, many Italian treaties - about thirty per cent – contain a clause, for applying the provisions of the domestic law of the residence Contracting State regarding the credit for foreign taxes, that is not present in these Models. The clause also assumes different wordings and sometimes meanings from one convention to another: for example, only some kinds of this clause establish that the domestic provisions shall not affect the general principle of the pertinent treaty. None of these clauses is set out for Italy, as residence Contracting State, in all the conventions of the Italian network. That identification and the relative conclusions have relevant consequences on the interpretation and application of the treaty provisions that set out for Italy the foreign tax credit quantitative limitations; these provisions are object of an exam in the other parts of this paper in comparison with the provisions of the Contracting States that have negotiated a treaty with Italy. The various kind of limitations on the amounts creditable are considered. A final issue concerns the not appreciable tendency of the Italian Agenzia delle Entrate to extend domestic substantial provisions regarding the credit for foreign taxes to the independent concept of foreign tax credit of the Italian treaties (art. 165 Tuir).