LensCrafters 2007 Annual Report Download - page 75

> 74 | ANNUAL REPORT 2007
TAX REGIME - HOLDERS OF ORDINARY SHARES
The gross amount of dividend paid to shareholders of Italian listed companies whose shares are
registered in a centralized deposit system managed by Monte Titoli S.p.A, who are individuals and
are Italian resident for tax purposes, will be subject to a 12.5% final substitute tax, provided the
shareholding is not related to the conduct of a business, and if these persons do not hold a
“qualified” shareholding. The 12.5% final substitute tax will not be applied only if they timely
declare that they satisfy the relevant requirements (eg. qualified shareholding or a shareholding
related to the conduct of a business)
This substitute tax will be levied by the Italian authorized intermediary that participates in the Monte
Titoli system and with which the securities are deposited, as well as by non-Italian intermediaries
participating in the Monte Titoli system (directly or through a non-Italian deposit system
participating in the Monte Titoli system), through a fiscal representative to be appointed in Italy.
Italian resident individuals who timely declare that they hold a qualified shareholding or a
shareholding related to the conduct of a business, will receive the gross amounts of dividends paid
and include dividends in their world wide taxable income, subject to the ordinary income tax rules.
The dividend paid to other subjects different from the above mentioned individuals, who are
resident in Italy for tax purposes, including those companies subject to IRES/IRPEF and foreign
companies with permanent establishment in Italy to which the shares are effectively connected,
investment funds, pension funds, real estate investment funds and subjects excluded from income
tax pursuant to Art. 74 of Presidential Decree No. 917/86, are not subject to substitute tax. Dividends
paid to entities subject to IRES/IRPEF different from individuals holding a non qualified shareholding
not related to the conduct of a business, will be subject to the ordinary income tax rules.
Italian law provides for a 27% final substitute tax rate on dividends paid to Italian residents who are
exempt from corporate income tax.
Dividend paid to beneficial owners who are not Italian resident and do not have a permanent
establishment in Italy to which the shares are effectively connected, are subject to 27% substitute
tax rate. However reduced rates (normally 15%) of substitute tax on dividends apply to non-
resident beneficial owners, who are entitled to and promptly comply with procedures for claiming
benefits under an applicable income tax treaty entered into by Italy. Under the currently applicable
Italy-U.S. Treaty, an Italian substitute tax at a reduced rate of 15% may generally apply to dividends
paid by Luxottica Group to a U.S. resident entitled to treaty benefits who promptly complies with
the procedures for claiming such benefits, provided the dividends are not effectively connected
with a permanent establishment in Italy through which the U.S. resident carries on a business or
with a fixed base in Italy through which the U.S. resident performs independent personal services.
The substitute tax regime does not apply if ordinary shares representing a “non-qualified” interest
in Luxottica Group are held by a shareholder in a discretionary investment portfolio managed by an
authorized professional intermediary, and the shareholder elects to be taxed at a flat rate of 12.5%
on the appreciation of the investment portfolio accrued at year-end (which appreciation includes
any dividends), pursuant to the so-called discretionary investment portfolio regime - regime del
risparmio gestito.
TAX REGIME - HOLDERS OF ADS
Dividends paid to beneficial owners who are not Italian residents and do not have a permanent
establishment in Italy to which the shares or ADSs are effectively connected, are generally subject
to a 27.0% substitute tax rate. Accordingly, the amount of the dividends paid to Deutsche Bank