• Michaël Vincke, Senior Manager |

After Campione d'Italia was added to the Customs Territory of the EU as from 1 January 2020, finally more details are known on the local consumption tax that now applies there. Below we summarize what you need to know.

Previously we wrote that Campione d'Italia is no longer part of the Swiss Customs Territory and was added to the Customs Territory of the EU as from 1 January 2020 on. Although the Italian enclave remains outside the territorial scope of the EU VAT regulations, it was decided to introduce a local consumption tax (imposta locale sul consumo di Campione d'Italia, ILCCI), making an end to its “no VAT regime”. Where it was expected and planned that the Ministry of Economy and Finance of Italy would publish a decree to define the application modalities of this local consumption tax in April 2020, such was only published in the Official Gazette of 9 February 2021. Hereafter, we highlight the general rules that define the ILCCI.

What is subject to the tax?

The ILCCI applies to:

  • supplies of goods and services provided by taxable persons in the Municipality to final consumers; as well as to
  • the importation of goods by final consumers, including the importation of goods from the territory of the European Union.

Similarly, as in VAT regulations, the decree specifies various situations in which no ILCCI is due (e.g. exemptions and exclusions).

E-commerce sales into Campione d'Italia

Many companies wondered how e-commerce sales to final consumers located in the Municipality of Campione d'Italia would be dealt with.

The Decree clearly mentions that for sales of goods into the Municipality from Italy, other EU Member States or non-EU countries (like Switzerland), whereby the goods are transported or shipped by the supplier or by third parties on its behalf in favor of final consumers resident or domiciled in the municipality, the tax is payable by said final consumer.

Therefore, e-commerce sales should in principle not trigger any registration obligation for foreign companies in Campione d'Italia.

Import of goods into Campione d'Italia by final consumers

The ILCCI relating to goods imported by final consumers, is ascertained, settled and collected by the Customs Office competent for the Municipality of Campione d'Italia.

Similarly, as in other countries, a low value consignment relief is in place and exemptions may apply for importation of goods carried in the personal baggage of residents.

Interestingly, the final consumer might also avoid paying ILCCI if he can proof that the goods have been definitively subject to VAT in Italy or in another EU Member State.

Provision of services

Generally, all services rendered by taxable persons incorporated or established in the municipality are considered to be carried out in the Municipality.

Furthermore, various other services rendered in the Municipality or performed for final consumers resident there may also be subject to ILCCI.

Tax rates

The ILCCI rates are in line with those currently applicable under the Swiss VAT law, i.e.:

  • the standard ILCCI rate is 7.7%;
  • the reduced ILCCI rate of 3.7% applies to hospitality services;
  • the reduced ILCCI rate of 2.5% applies to supplies of alimentary products, newspapers and books, medicines and some other products consumed on a daily basis.

Declaring and paying of the ILCCI

Generally, the ILCCI needs to be paid in two instalments:

  • the first instalment is due on 16 September and relates to the tax due on the supply of goods and services by 30 June of the same year;
  • the second instalment is due on 16 March of the following year and relates to the tax due on the supply of goods and services as well as on the introduction into the Municipality of goods coming from the EU by 31 December of the previous year.

Additionally, a declaration is to be filed by 30 June of the following year.

What about 2020?

We were all wondering how the tax would be collected for 2020 as there were no clear guidelines published. The answer on that question can be found under the transitional provisions section of the Decree and can be summarized as follows:

  • The ILCCI relating to transactions carried out by 30 June 2020 is not due if the transactions have been subject to VAT in Switzerland or an EU Member State (and this VAT was or will not be subject to reimbursement).
  • For other transactions carried out by 30 June 2020 as well as for transactions carried out in the second half of 2020, the ILCCI is payable by 16 March 2021. If taxpayers are not able to reconstruct the tax amount due (e.g. as they did not adjust their ERP system in this respect), the ILCCI is determined presumptively on the basis of objective, logical criteria and consistent with the activity type of the taxable person.


Companies doing business with or out of Campione d’Italia should review their transactional flows and determine whether their business processes need to be modified following this change.

As the Decree foresees potential penalties up to 200% of the unpaid ILCCI (plus late payment interests) depending on the infringement, it is recommendable to perform such impact analysis as soon as possible. Please do not hesitate to reach out to your KPMG contacts to assist you with this assessment.

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