Netflix pays 56 million unpaid taxes. “The first case in the world of a mysterious society without people” –

from Giuseppe Guastella

The California giant that distributes pay-per-stream movies and TV series closes row with tax returns. Before opening an Italian office in January, it had made millions of subscriptions without offices and staff. Netflix: “Dialogue and Collaboration”

Netflix is ​​coming to terms with the Italian tax authorities. California giant of paid movies and TV series Closing the dispute with the revenue agency He paid approximately 55 million and 850 thousand euros in one go. This is how the tax front of the investigation conducted by the Milan Public Prosecutor’s Office and the Gdf Economic and Financial Police Unit is determined. Deleted tax return, i.e. for unpaid taxes in Italy. When the investigation began in Italy, not a single worker or company belonged to the American parent company: Netflix has made millions of euros by selling movies and TV series without paying 1 euro in taxes. Meanwhile, the group has opened its own operational headquarters since January 1, 2022.

Investigation and Prosecutor Viola

The ‘Multinational Group’ reads a note signed by the Public Prosecutor of Milan Marcello Viola, ‘at the end of the tax assessment phase’ made the lump-sum payment and in one solution ‘of €55,850,513 by Taxes, fines and interest to identify each suspense With the Italian Tax Agency for the period from October 2015 to 2019. In the investigation, coordinated by Prosecutor Enrico Pavoni (who inherited the file from his colleague Gaetano Rotta, who spent a year in the European Prosecutor’s Office), unlike previous tax investigations in Milan that involved Apple, Google or Facebook (which had some organization in Italy). ), competing with the American group led by Reed Hastings – «the world’s first case – A stable “invisible” organization of a foreign company operating in the digital economy completely devoid of employees It is characterized by an exclusively developed technological structure. The structure that “would have been subject to the exclusive performance of the company’s main functions for the conduct of its business in the country.”

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Servers and streaming

Netflix’s “Content Delivery Network” consists of More than 350 serverswhich could have been used exclusively and always throughout the national territory in major data centers and telephone operators.” This means that the group had a technological infrastructure in Italy and here it “produced income” with subscriptions (That’s why the tax dispute). “This complex and sophisticated technological infrastructure could have formed the basis – as the Attorney General led by Viola wrote – on which the Guardia di Finanza first and later the Revenue Agency established the basic technical legal requirements, required by international and national standards, for the formation of a permanent ‘physical’ institution, That is, with technological infrastructures, “for a foreign company, considered suitable for generating commercial income in Italian territory”.

Turning point from January 1, 2022

Since the first of last January Netflix has set up a company “under Italian law That began to require contracts and bill fees derived from subscriptions signed with national users. This will determine taxes in Italy on income from the sale of subscriptions to users residing in the national territory.”

Netflix Comment: “We’re Satisfied”

A Netflix spokesperson said: “We are pleased to have concluded this case, which involved the 2015-2019 fiscal years. We have maintained continuous dialogue and cooperation with the Italian authorities We continue to believe that we acted in full compliance with the Italian and international regulations applicable to the case in question.”

May 20 2022 (change on May 20, 2022 | 15:46)

Thelma Binder

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