Rents: in municipalities affected by natural disasters, a flat-rate tax of 10 per cent applies even without registers

An official response from the Lombardy Region has broadened the scope of areas affected by natural disasters where it is possible to benefit from the reduced flat-rate tax on agreed-upon rents: this now effectively includes all municipalities in the provinces of Como, Varese, Bergamo and Lecco. The clarification was issued on 26 October by the Region’s Directorate-General for Security and Civil Protection, following an enquiry from Confedilizia Como. However, the response may also have implications beyond the province of Como. In practice, it confirms that – contrary to what the tax authorities had requested – there need not necessarily be a specific list of the individual municipalities in which the flat-rate tax of 10 per cent applies instead of 21 per cent.

Let’s look at where this regulatory tangle stems from. With the law converting the 2014 ‘Casa Decree’ (Decree-Law 47), a provision was added – paragraph 2-bis of Article 9 – which grants the 10 per cent flat-rate tax to agreed-rent tenancy agreements entered into ‘in municipalities for which a state of emergency has been declared’ in the five years prior to 28 May 2014, due to ‘disasters’.

Apart from cases of natural disasters, the reduced flat-rate tax on agreed rents applies only in local authorities with a severe housing shortage. In the case of the province of Como, this applies only to the provincial capital. But how can one identify the areas affected by natural disasters? Initially, the Revenue Agency appeared to be satisfied with the Council of Ministers’ declaration of a state of emergency, which generally covers a fairly large area. This was the position taken by the Lombardy Regional Tax Office in ruling 904-355/2018, which was subsequently revoked. Ruling 470/2019, on the other hand, requires reference to the subsequent orders issued by the commissioner responsible for managing the emergency, which usually list the localities in greater detail. And this is precisely where the request for civic access submitted by Confedilizia di Como comes in, seeking to ascertain the Commissioner’s measures, including the lists of affected municipalities.

In its reply, the Region points out, first of all, that the Prime Ministerial Decree of 24 July 2009 – in declaring a state of emergency due to adverse weather conditions in the provinces of Como, Varese, Bergamo and Lecco – did not contain ‘any further delimitation at municipal level’. It then states that the subsequent Civil Protection Order of 13 May 2010 (No. 3878) did not contain any such list either. The result is that all municipalities in the province of Como – and the same applies to the other three provinces – ‘are covered by the national state of emergency pursuant to the Prime Ministerial Decree of 24 July 2009’.

Claudio Bocchietti, president of Confedilizia Como, comments: ‘It follows from this response that all “3+2” tenancy agreements entered into in any municipality in the province of Como – and not just in the provincial capital – have always been entitled, from 2014 onwards, to apply the 10 per cent flat-rate tax rather than the 21 per cent rate.’ This now paves the way for refunds: “We are currently working with our professionals to set up a helpdesk for our members to submit claims for the refund of tax overpaid in recent years.”