Italy: Direct online sales fall outside scope of digital services tax (court decision)
Decision distinguishes direct sales activities from digital intermediation services.
The First-Instance Tax Court of Milan on January 22, 2026, held that revenues derived from direct online sales were not subject to Italy's digital services tax (DST).
The case involved an online retailer seeking a refund of DST paid on sales conducted under arrangements in which products were sold directly to customers by the retailer. The taxpayer argued that customers interacted only with the retailer and not with suppliers or other users through the website.
The court agreed, finding that the platform did not constitute a multilateral digital interface for DST purposes. The court also concluded that the taxpayer acted as a seller rather than an intermediary, as it entered into contracts in its own name, set prices, and assumed the relevant commercial risks. Accordingly, the revenues were held to fall outside the scope of the DST.
Read an August 2026 report prepared by KPMG's EU Tax Centre