“the average time for fiscal administrative reports amounts to 238 hours vs. 160 hours in OECD countries”

“the average time for fiscal administrative reports amounts to 238 hours vs. 160 hours in OECD countries”

In ‘ The Financial Complexity report 2018’, Italy ranks 4th in the global ranking. Why is Italy one of the most complex jurisdictions for accounting and tax compliance?

The Italian accounting system contains specificities that enhance complexity. As an example, contrary to France, Italy does not have a normative chart of accounts with a predetermined structure. This situation brings more complexity and from one company to the other, the chart of accounts differs.

In most Italian companies, payroll is one of the cruxes of the accounting matter. There are more than 864 national contract types in Italy, which ranks #2 (behind France) in the Global Payroll Complexity Report 2017, mainly due to fiscal government reporting and declarations. Each employee has specificities in its pay slip which tends to increase the complexity of payroll management.

Moreover, companies’ financial statements, and particularly SMEs, derives from national accounting rules but also includes fiscal rules that sometimes overwhelm accounting rules. Since the fiscal system is itself complex in Italy, financial statements are becoming more complex.

Thus, the tax system in Italy is time-consuming due to a jurisdiction that is frequently evolving and with a high number of reports and returns to be submitted to fiscal administration. Hence, the average time for fiscal administrative reports amounts to 238 hours vs. 160 hours in OECD countries and the number of taxes paid per year amounts to 14 vs. 10 in other OECD countries. In addition, I think the complexity can also be explained by the different layers of tax raising at national, regional and municipal level.

Since 2014, Italy has implemented a consumer’s code which is a complex text for e-commerce. It introduced the right of withdrawal and to rethink on the acquisition made by a client. This right obliges the e-commerce company to accept a return of the good within 14 days from the reception of the good, even if it is deteriorated. Moreover, other obligations such as full transparency on costs (delivery, shipment, etc.) and the impossibility to increase the price when payments occur with a credit card.

Moreover, the Italian Association for Electronic Commerce (AICEL) gathers 5.000 companies and 25.000 persons in Italy, applying a behavior code which relates to best practices in terms of sales conditions, guarantees, data protection and sales order management. The association provides a label “Sono Sicuro” which allows e-commerce Italian customers to enhance trust in transaction and in the provider. In case of disrespect of the code, disciplinary sanctions can be taken and publicly disclosed.

What effect do current tax systems/schemes have on ecommerce in Italy?

E-commerce and digital companies may suffer from the 2018 Italian budget law which recently introduced the “Web Tax”. This 3% tax rate on each transaction, is due by resident and non-resident companies rendering more than 3.000 digital B2B transactions per year. In fact, Italy has long complained that companies such as Amazon, Apple and Google have avoided taxes by maintaining they do not have a “stable presence” in the country, even though they generate huge revenues there and this new law clearly intends to get around that hurdle.

Do you think there are economical benefits from online retailers becoming and/or remaining ethical?

I think there is a real market opportunity for online retailers to become ethical. Evidence of this new generated market is the apparition of new apps, such as “Give”, allowing to buy and exchange ethic products from other customers. Thus, this new kind of app also brings forward a community of online consumers that intend to make a real choice through their acquisitions.

Online communities are crucial for online retailers since their reputational risk is at stake, in the era of class action. Social networks convey digital firms that lead the ethical values and the ones to be banned. The website BESK provides customers with a selection of online retailers with social and ethical values and with sustainability criterions. Through Twitter, this wesite also communicates ratings and a focus on an online retailer that is valuable.

Moreover, a new generation of digital consumers (“the millennials”) will be much more attentive to the sustainable process of goods’ production. Thus, the 2018 report “Pulse on the Fashion industry” emphasized that improving a fashion brand’s environmental and social performance boosts profitability.


Implementing mainly efficient energy consumption, respectful and secure working conditions, and sustainable materials, fashion companies might have a positive EBIT uplift of 1 to 2 percentage points, which reveals the true value of sustainable policies.


Do you feel Italian consumer trust in online retailers is declining?

No, I think the trust is increasing and the arrival of Iliad (Free in France) is an example of the potential of the Italian market for online retailers. In fact, Italy is the one country with the highest penetration rate for mobile phones or smartphone in Europe (89% vs. 85% in France, 86% in Germany and 79% in the UK). However, Italy remains one of the countries with the lowest
penetration rate for ecommerce, so I think there is a real opportunity of catching up to the market. Moreover, the economic fabric of Italian companies is mostly composed of SMEs that must draw up to digital transformation and increase the pace of ecommerce to capture future growth leverages.

Some traditional Italian companies have experienced real success stories such as Venchi (ice-cream shop), Boggi (clothes) and Lanieri (tailored suits). Turning digital, these brands have experienced tremendous growth in the past few years and Boggi recently launched the Boggi Omnichannel experience that allows clients to acquire online and receive delivery or withdraw products in the shop. Nonetheless, Italian consumers’ trust in “brick-and-mortar” retailers is still strong and the emergence of the Death by Amazon index casts a shadow on the moral sense of e-commerce.

In March 2018, the famous suit brand Cornelliani announced to initiate digitalization through a platform called Alkemy. The company asserts that a key parameter to choose a platform was the analysis of the value chain between the production of goods and the online sales.

This platform embraces a chart of ethics and compliance, as well as a behaviour code that aims at reinforcing trust in e- commerce and I think this recent launch shows the increasing trust in online retailers in Italy.
must adapt to the fourth Industrial Revolution, with a value chain focused on the consumer and a digitalization of processes affecting the whole supply chain.

What are some of the main ethical issues businesses have to deal with in e-commerce?


As we have seen recently with Cambridge Analytica and Facebook, data privacy is a key issue for digital companies. Digital companies’ databases are the new oil of our century and a market already exists for data value. I trust this trend will continue to grow, embracing ethics and compliance issues. Thus, theft of information or intellectual property is a key issue to be tackled. As of today, the new GDPR regulation has reinforced the privacy regulation and governance, providing individuals with information about who and how their data are managed.



For e-commerce companies, aiming at delivering high-quality products with even shorter delays, supply chain traceability will be a key for consumer’s trust.

As an example, the Italian brand of clothing YOOX communicates its sustainability information to e-commerce customers. The brand evokes its
objectives to reach 100% of renewable energy adhering to the RE100 program, but also its adhesion to the supplier quality label “Fur Free Retailer” which is committed to caring about animals and guarantees clothes free of animal fur. Moreover, YOOX intends to obtain the rating “excellent” of the sustainability standard BREEAM (Building Research Establishment Environmental Assessment Method) for its new logistics center in Milan.

What are the opportunities and challenges for businesses to apply business ethics in their online trading ? Generally, and more specifically, for Italy?

I think business ethics is more than best practices and fair values in commercial relationships, but it can also be a real opportunity for companies to create added-value to their business. Many studies have shown that the willingness to pay a higher price for an investor is directly related to the ethical criterion of the production of a good.

According to this, the word “etrust” has emerged among the e-commerce companies, indicating the situation that consumers believe in online trading where they make business transactions.

For example, when a consumer purchases a product from an online shop, e-trust recognizes the expectation of that person to receive exactly the product he or she has ordered. Thus, I think the main challenges are found in three pillars: internet trust, which is related to internet’s performance as speed or integrity, vendor trust, which refers to the trust in the producer who sells the product, and third parties trust, which refers to
intermediaries implied in a transaction.


It is commonly agreed that e-trust plays a key role in internet digital transactions since consumers are more likely to commit themselves in e-commerce with a company they trust more. Companies will also be assessed for having good ethical performance if they practice good e-trust and thus, develop customer relationships. Therefore, building trust that ensures a compelling reputation over transparency and ethics and leads to satisfied clients becomes a crucial task of every company doing online business.

More specifically in Italy, supply chain challenges have been raised due to the rapid growth of digitalization of brands. As an example, in 2016 the logistic center of Stradella, which manages the e-commerce platform
of H&M in Italy, used to face important strikes due to the increased pressure and the downgrade of labor conditions. Interestingly, e-commerce products must be delivered within short a short time-lapse and subsequently, supply chain centers experience a lot of pressure, creating resentment.



“As we have seen recently with Cambridge Analytica and
Facebook, data pricacy is a key issue for digital companies.”