Italian pay-TV faces VAT rise

Pay-TV broadcasters in Italy are facing up to the prospect of a doubling in the amount of VAT payable on their subscription packages.

The Italian government, led by prime minister and media magnate Silvio Berlusconi, announced the measure as part of a so-called “anti-crisis” package. VAT on subscriptions will rise from 10% to 20% and increases a typical Sky Italia package by €50 per year.

Berlusconi has denied penalising Sky Italia, pointing out that subscribers to channels operated by his own Mediaset would also be hit by the charge, however opposition MPs said the affect on the Mediaset Premium pre-pay cards would be negligible.

Sky Italia chief executive Tom Mockridge said the increase would hit families that were already experiencing difficult times. A Sky Italia statement pointed out that the company employs 5,000 Italian workers and contributed an annual €370 million to the Italian exchequer.