Transfer Pricing Chambers Practice Guide’s chapter dedicated to Italy – Trends & Developments.
Recent Developments in the Application of the Arm’s Length Principle in Italy.

The 2017 reform of the transfer pricing framework reformulated the arm’s length principle in Italian tax law, aligning the content of Article 110 paragraph 7 of the Income Tax Code with international best practices. Following the 2017 reform the Italian Tax Administration has given specific guidance on the interpretation and application of the new transfer pricing rules. The correct application of the concept of the arm’s length range is deeply analysed both in light of the newly expressed Italian Revenue Agency position and as declined in some relevant domestic judicial cases issued in 2022.