Italy's Omnibus Decree sets new limits on multi-year tax audits

The Omnibus Decree (Decreto Omnibus) introduces significant changes to tax audit procedures in Italy, specifically targeting how the Agenzia delle Entrate handles multi-year business expenses. Under Article 22 of Legislative Decree no. 148/2026, new time limits have been established for contesting negative income components that have multi-year effects, such as depreciation and costs spread across several fiscal years.

Previously, tax inspectors could contest the legitimacy of a business expense many years after it was actually incurred. The new regulation establishes a more protective rule for taxpayers: if a dispute concerns the very nature of a cost, the timeframe for the audit begins from the first tax return in which that expense appears. This change aims to provide greater legal certainty for companies managing long-term investments like industrial buildings or expensive machinery, where costs are deducted in fractions over time through amortization.