Press Release: Direct Taxation: Commission requests Italy to end the application of a withholding tax on dividends paid to parent companies in the Netherlands

The European Commission has sent Italy a formal request to end the application of a withholding tax on the distribution of dividends to parent companies established in the Netherlands. The request is in the form of a ‘reasoned opinion’, the second step of the procedure under Article 226 of the EC Treaty, Italy having failed to react to the letter of formal notice sent by the Commission on the matter. If Italy does not reply satisfactorily to the reasoned opinion within two months the Commission may refer the matter to the European Court of Justice.