Italian Supreme Court deals with the notion of preparatory and auxiliary activities for the purpose of establishing the existence of a permanent establishment in Italy and determining its taxable profits.

Di Paolo Arginelli -
Abstract In its order No. 21693 of October 8, 2020, the Italian Supreme Court examined certain issues concerning the existence of an Italian permanent establishment of a Panamanian company and the attribution of profits thereto for corporate income tax purposes. The Supreme Court set aside the decision of the Tax Court of Appeals and sent the case back to a different chamber thereof, affirming four principles to be followed by the latter judge. The present contribution critically analyzes the Supreme Court’s order and discusses how the Italian provisions dealing with the existence of, and the attribution of profits to, a permanent establishment should be construed, in particular where some. . .