What is the difference between Property Wealth Tax and IBI?

BtBoth are taxes placed on property, but PWT’s exaction is competence of the State, whereas IBI’s is of local competence. The main practical difference is the way the taxable base is ascertained, and how the amount is calculated.

Taxable base.

PWT’s taxable base is defined with regard to the declared value on the title deeds while IBI’s is defined with regard to the cadastral value, the official value assigned to the Property by the Town Hall, which is almost always lower than the declared value.

Calculation

a. With regard to PWT the tax agency places a tax rate of 0.2 % up to assets of 167.129’45, after that the rate goes up as assets go up. The amount is divided between as many titleholders as there are, which reduces the amount to be paid a little. Mortgages upon the property can be deducted from the declared value, which also reduces the amount to be paid.

 b. With regard to IBI, the tax agency places a rate of 0.4% upon the cadastral value of the property, but the amount to be paid is lower than the one of the PWT, because the taxable base is lower.