EN 
 
 
OPINION OF THE EUROPEAN CENTRAL BANK 
of 24 July 2009 
on an amended draft legislative provision on the taxation of the Banca d’Italia’s gold reserves 
(CON/2009/63) 
 
Introduction and legal basis  
On 21 July 2009 the European Central Bank (ECB) r eceived a request from the Italian Minister for 
Economic Affairs and Finance for an opinion on a dr aft amendment to Article 14 of Decree-Law No 78 
of 1 July 2009 containing measures on the crisis a nd prorogation terms and on the Italian participation in 
international missions1 (hereinafter the ‘Decree-Law’). The Decr ee-Law is currently being discussed by 
the Italian Parliament for conversion into law (her einafter the ‘draft law’) within 60 days following 
publication in the Gazzetta Ufficiale della Repubblica Italiana . Article 14 of the Decree-Law provides for 
a capital gains tax on non-industrial gold of firms a nd entities and relates to the Banca d’Italia. The 
subject of this opinion is an amende d draft version of Article 14 (herei nafter the ‘amended draft article’), 
in the text attached to the request from the Minister. 
The ECB’s competence to deliver an  opinion is based on Article 105(4) of the Treaty establishing the 
European Community and the third indent of Article 2(1) of Council Decision 98/415/EC of 29 June 1998 
on the consultation of the European Central Bank by  national authorities regarding draft legislative 
provisions2, as the amended draft article relates to the Ba nca d’Italia. In accordance with the first sentence 
of Article 17.5 of the Rules of Procedure of th e European Central Bank, the Governing Council has 
adopted this opinion. 
 1. Purpose of the amended draft article  
The amended draft article is a new version of Artic le 14 of the Decree-Law, on which the ECB recently 
delivered Opinion CON/2009/59
3. According to the consultation le tter from the Minister for Economic 
Affairs and Finance, in order to address the issues raised in Opinion CON/2009/59, the amended draft 
article would replace the original text of Article 14. The amended draft article is divided into five 
paragraphs. Paragraph 1 provides that for the fiscal y ear in the course of which the draft law enters into 
force, a substitute tax of 6 %, up to a maximum am ount of EUR 300 million, will be levied on capital 
gains registered in the balance sheet generated from the fiscal year-end price evaluation of stocks of 
precious metals for non-industrial u se. Paragraph 2 provides for the timing of the taxation payments. 
                                                 
1  Gazzetta Ufficiale della  Repubblica Italiana  No 150, 1.7.2009, p. 1. 
2  OJ L 189, 3.7.1998, p. 42.  
3  All ECB opinions are available on the ECB’s website at www. ecb.europa.eu.  
2 Paragraph 3 provides for a special tax regime applicable to realised cap ital gains generated by a total or 
partial transfer of stocks of precious metals if su ch a transfer takes place within three fiscal years 
following the fiscal year in the course of which the draf t law enters into force. Paragraph 4 contains other 
provisions relating to the substitute tax on notional gains and provides for special conditions for the 
application of the amended draft article in respect of  the Banca d’Italia’s gold stocks. Finally, paragraph 5 
provides for financial measures to be adopted if, following recourse to the procedures laid down in 
paragraph 4 for the taxation of the Banca d’Italia’s gold stocks, th e increased budgeted revenue provided 
for by the amended draft article is lower than  the estimated amount of EUR 300 million for 2009. 
 2. General observations   
2.1 As already stated above, the original text of Article 14 of the Decree-Law was the subject of the 
recent ECB Opinion CON/2009/59, in which th e ECB made several comments on the draft 
legislative provision on the taxation of the Banca d’It alia’s gold reserves, with particular reference 
to its compliance with Article 108 and Article 101(1) of the Treaty
4, as well as Article 26.4 of the 
Statute of the ESCB. The comments specifically addressed the following issues: (i) central bank 
financial independence; (ii) central bank ins titutional independence; (iii) the prohibition on 
monetary financing; (iv) compliance with the Eu rosystem accounting prin ciples; (v) retroactive 
application of the new tax; (vi) the timing of th e taxation payments; and (vii) the set-off right under 
Article 65 of Law No 289 of 27 December 2002, as amended5. 
2.2 The observations made in Opinion CON/2009/59  also apply to the amended draft article. 
 3. Specific comments 3.1  Central bank financial independence   
In Opinion CON/2009/59, the ECB expressed its c oncern that the new tax on unrealised capital 
gains, generated from the price evaluation of gold st ocks on the assets side of the Banca d’Italia’s 
balance sheet
6 would weaken the Banca d’It alia’s financial independence7, since the Banca d’Italia 
may potentially: (i) never realise such notional gain s, as a result either of its management strategy 
not to sell any of its gold reserves, of subsequent  negative price developments, or other limitations 
by which it is bound8 ; or (ii) realise profits that are lo wer than the notional gains constituting the 
tax base. Thus, the Banca d’Italia may need to decrease its resources to make the required tax payments. The ECB notes that an attempt to addr ess the financial independence issue is made in 
                                                 
4  As also reflected respectively in Article 7 and Article 21.1 of the Statute of the European System of Central Banks and of 
the European Central Bank (hereina fter the ‘Statute of the ESCB’). 
5  Gazzetta Ufficiale della Repubblica Italiana, S.O., No 305, 31.12.2002. 
6  The notional gains, pursuant the prudence principle laid  down in Guideline ECB/2006/16 of 10 November 2006 on the 
legal framework for accounting and financ ial reporting in the European System of Central Banks (see paragraph 3.4 
below), are balanced by equal amounts booked in a dedicated revaluation account on the lia bilities side of the Banca 
d’Italia’s balance sheet. This circumstance is not taken into account by the draft article. 
7  See paragraphs 2.2(a) and 3.2 of Opinion CON/2009/59. 
8  See in particular the Central Bank Gold Agreement referre d to in the ‘Joint Statement on Gold’ of 8 March 2004, 
available on the ECB’s website. 
3 the amended draft article under which: (i) the new tax applies only for the fiscal year in the course 
of which the draft law enters into force, i.e. it is a ‘one-off’ tax; (ii) a maximum amount of the 
payable tax is set at EUR 300 million; and (iii) th e new tax applies to the Banca d’Italia’s gold 
stocks ‘to the extent appropriate to guarantee the institutional and financial independence of the 
central bank’, and this extent is to be determin ed by means of a ‘decree not having a regulatory 
nature’ by the Minister of Economic Affairs and Fi nance, after having obtained the Banca d’Italia’s 
assent ( parere conforme ). Although the limitations referred to unde r (i) to (iii) aim at mitigating the 
negative impact of the amended draft article on the Banca d’Italia’s financial independence, 
paragraphs 1, 2 and 4 of the am ended draft article still provide for a tax on unrealised, and  thus 
uncertain capital gains. Therefore, the tax essentially  results in a withdrawal of central bank assets. 
In addition, the amended draft article raises concer ns as regards the difficulty in making an advance 
estimate of a national central bank’s (NCB) financia l needs: in this regard , the ECB stresses that 
future financial and economic deve lopments, especially in the current crisis context, cannot be 
foreseen with any degree of certainty. For the ab ove reasons, the ECB is of the view that the 
amended draft article would impair the princi ple of central bank financial independence. 
 
3.2  Central bank institutional independence  
3.2.1 In Opinion CON/2009/59 the ECB noted that the previous version of the draft article, by providing 
for the taxation of theoretical and unrealised capital gains, would also constrain the Banca d’Italia’s 
capacity to implement appropriate management strategies in relation to its gold reserves, since, instead of targeting optimal realisation of its cen tral bank tasks, it would need to mitigate the 
financial risks of the arising ta x liabilities. Since hol ding and managing the foreign reserves of the 
Member States is a Eurosystem task  pursuant to the third indent of Article 105(2) of the Treaty, the 
Banca d’Italia’s institutional i ndependence safeguarded under the Treaty would thus be infringed
9. 
The amended draft article, as seen above, still provid es for the taxation of merely theoretical and 
unrealised capital gains on gold reserves. Therefor e, the ECB has to reassert  the incompatibility of 
the amended draft article with the principle of central bank institutional independence pursuant to 
Article 108 of the Treaty. 
3.2.2 In addition, the new paragraph 3 of the amende d draft article provides for a special taxation regime 
that would apply to realised capital gains arising from a transfer of precious metals stocks for non-
industrial use, provided that such transfer takes place within three fiscal years following the fiscal 
year in the course of which the draft law enters into force10. The ECB notes that this special 
                                                 
9  See paragraph 3.2 of Opinion CON/2009/59. It is noted that th e amended draft article seems to confuse the concepts of 
financial independence and institutional independence, since it erroneously assu mes that institutional independence could 
be safeguarded by means of quantitative thresholds. About the principle of fina ncial independence, see, e.g., Opinion 
CON/2009/26; Opinion CON/2003/22; ECB’ s Convergence Report May 2008, pp. 20-22. About the principle of 
institutional independence, see, e.g., Opinion C ON/2008/31; Opinion CON/2005/54; ECB’s Convergence Report 
May 2008, pp. 18-19. 
10  It is understood that the effects of the special taxation regi me provided for by paragraph 3 of the amended draft article 
would be as follows: (i) in case a total or partial transfer of  gold stocks is made within three fiscal years following the 
fiscal year in the course of which the draft law enters into fo rce, the realised capital gain, which is subject to the income 
tax (IRES) and the regional tax on productive activities (IRAP),  would be increased by the amount of the capital gains – 
4 taxation regime: (i) would essentially apply to the Banca d’Italia, as does the substitute tax 
provided for in paragraph 1 of the amended draft ar ticle, to which it is linked; and (ii) given its 
temporary nature, would place pressure on the Banca d’Italia in terms of the timing of possible gold sales, and could thus interfere with its foreign reserve management decisions. The ECB 
therefore concludes that paragraph 3 of the am ended draft article constitutes a more serious 
impairment of the institutional independence of th e Banca d’Italia estab lished under Article 108 of 
the Treaty than the one the ECB already addressed in Opinion CON/2009/59. 
  3.3  Prohibition on monetary financing  
In Opinion CON/2009/59 the ECB noted that, since the substitute tax provided for by the previous 
version of the draft article is levied on unrealised capital gains, i.e. theoretical gains arising out of 
changes in the accounting valuation of the NCB’s gold reserves, the related tax payments by the 
NCB would result: (i) to the extent that they are not to be covered by future realised profits, in an 
increase of the monetary volume through provision of central bank money to the public sector; and (ii) to the extent that they are to be covered by future realised profits, in a form of central bank 
credit to the public sector, through the distributio n in advance of future and uncertain profits
11. The 
ECB found that in both cases the previous version of the draft article was incompatible with the prohibition on monetary financing u nder Article 101(1) of the Treaty. 
The amended draft article does not address this fundame ntal issue, since, as already noted, it still 
provides for the taxation of unrealised capital gains
12. Therefore, the ECB reasserts that the 
amended draft article is incompatible with the prohibition on monetary financing under 
Article 101(1) of the Treaty. In addition, such in compatibility cannot be remedied by any form of 
agreement between a Member State and an NCB, nor by any form of ‘assent’ issued by the latter, 
as seems to be implied by paragra ph 4 of the amended draft article. 
 3.4  Eurosystem accounting principles   
In Opinion CON/2009/59
13 the ECB stated that the previous version of the draft article was not in 
line with basic accounting assumptions laid down in Guideline ECB/2006/16 of 10 November 2006 on the legal framework for accounting and financial reporting in the European System of Central 
Banks
14 and, in particular, with the basic accoun ting assumption of prudence, which allows the 
achievement and maintenance of the financia l independence of Eurosystem central banks15.  
                                                                                                                                                             
corresponding to the transferred stocks – s ubject to the substitute tax under paragra ph 1, and the substitute tax paid with 
reference to the same stocks woul d be deducted by income taxes; (ii) on the contrary, in the event that such a transfer is 
made after the abovementioned deadline, the realised capit al gains subject to IRES and IRAP would no longer be 
increased by the said amount, and the substitute  tax paid would no longer be deductible. 
11  See paragraph 3.3 of Opinion CON/2009/59. 
12  See paragraphs 1, 2 and 4 of the amended draft article. 
13  See paragraph 3.4 of Opinion CON/2009/59. 
14  OJ L 348, 11.12.2006, p. 1. 
15  It is recalled that under the basic assu mption of prudence, unrealised capital gain s are not recognised as income in the 
profit and loss account, but are recorded directly in a revaluation account and are thus excluded from the profit 
5 The ECB notes that this issue is not addressed  by the amendment under consideration. 
Furthermore, the amended draft article still provides for a derogation from all other legal 
provisions, which, as already stated in Opini on CON/2009/59, weakens the prudence principle and 
appears to be incompatible with the primacy of Community law. 
 
3.5  Retroactivity of the new tax 
3.5.1 In Opinion CON/2009/59, the ECB noted that the previous version of the draft article did not 
clearly exclude a retroactive application of the new tax, i.e. its application to the entire amount of 
unrealised capital gains currently registered in the dedicated revaluation account, instead of the 
mere amount of notional gains accrued in the first fiscal year from its entry into force. The ECB 
also noted that any retroactive application of new taxes to NCBs, retroactive application being 
understood as application of the taxation obligations  to reporting periods earlier than the first full 
reporting period after entry into force of the tax,  would be detrimental to  central bank financial 
independence, since it would impair the NCBs’ ability to efficiently plan the use of their financial 
resources16. 
3.5.2 In the light of the amended draft article a nd of the explanatory memorandum to the draft law17, 
which has now become available, the ECB understands that the new tax is indeed retroactive in two 
different ways: (i) it would apply to the current re porting period, which started before its entry into 
force; and (ii) it would apply to the entire amount of  unrealised capital gains currently registered in 
the dedicated revaluation account, without prejudice to the maximum tax amount set pursuant to paragraphs 1 and 4 of the amended draft article
18. The ECB remarks that such retroactive effects of 
the new tax aggravate its non-compliance with the principle of central bank independence. 
 3.6  Timing of the taxation payments  
3.6.1 In Opinion CON/2009/59 the ECB stated that, without prejudice to the preceding observations, the 
taxation payments mechanism provided for by the previous version of the draft article could 
represent per se  a further breach of Article 101(1) of the Treaty
19. 
3.6.2 The ECB confirms this statement and furthermor e notes that this breach is now aggravated by the 
amended draft article, which delete d the taxpayer’s option, originally provided for by paragraph 2 
of the previous version of the draft article, of paying 50 % of the instalment on the tax in two 
instalments of equal amounts within the dead line for annual settlement of income tax. 
                                                                                                                                                             
distribution scheme. These principles, la id down by the ECB’s Governing Council pursuant to Article 26.4 of the Statute 
of the ESCB, are currently relevant also for the Banca d’Italia ’s taxation, accordi ng to Article 8(1) of Legislative Decree 
No 43 of 10 March 1998 ( Gazzetta Ufficiale della Repubblica Italiana  No 61, 14.3.1998) and Article 114 of the 
Consolidated Law on taxation (Decree of th e President of the Republic No 917/1986, in Gazzetta Ufficiale della 
Repubblica Italiana , S.O., No 302, 31.12.1986, as amended). 
16  See paragraph 3.5 of Opinion CON/2009/59. 
17  The explanatory memorandum is now available on the Italian Parlia ment’s website at www.camera.it. 
18  It is noted that the maximum tax amount set at EUR 300 m illion does not exclude the retroactive effects described above. 
19  See paragraph 3.6 of Opinion CON/2009/59. 
6  
3.7  Set-off right under Law No 289/2002  
The last statement made in Opinion CON/2009/5920 concerns the exclusion, with reference to the 
new tax, of the set-off right granted to the Ba nca d’Italia by Article 65 of Law No 289 of 27 
December 200221, as amended. Also this issue is not addressed by the amended draft article; 
therefore the ECB entirely refers to and reasserts its  statement, which relates to a further issue of 
non-compliance with Article 101(1) of the Treaty.   
 4. Conclusions In view of the above, the ECB concludes as follows.  First, the amended draft article impairs the Banca d’ Italia’s financial indepe ndence, by allowing for a 
decrease in the Banca d’Italia’s resources which has no relationship with the amount of the Banca 
d’Italia’s realised profits. Second,  the amended draft article impairs the Banca d’Italia’s institutional 
independence, since it potentially forces the Banca d’Ita lia, with particular reference to its Eurosystem 
task of holding and managing foreign reserves, to de ploy asset management strategies targeting financial 
risks created by the proposed new tax provisions. Third, the amended draft article is incompatible with 
the prohibition on central ba nk monetary financing of the public sector, to the extent that it provides for 
profit distributions in the expectation of uncertain ce ntral bank income potentially realised in the future 
and, in addition, it excludes set-off rights applicable  under earlier legislation. Fourth, the amended draft 
article is not in line with the rules established by th e ECB pursuant to Article 26.4 of the Statute of the 
ESCB. 
The ECB trusts that it will be consulted on any future or  revised draft legislative provisions in this matter. 
 This opinion will be published on the ECB’s website.   Done at Frankfurt am Main, 24 July 2009. 
 
[signed] 
 
The Vice-President of the ECB 
Lucas D. PAPADEMOS 
 
                                                 
20  See paragraph 3.7 of Opinion CON/2009/59. 
21  Gazzetta Ufficiale della  Repubblica Italiana , S.O., No 305, 31.12.2002.