Vita gazette – Pope Francis, often on the agenda with his correct approach, said “no” to the free or cheap use of Vatican real estate. With this call from the Pope, cardinals and senior officials will have to give up free or advantageous rents.

Indeed, Pope Francis has ordered repealing all free or subsidised rentals granted to cardinals for properties the Holy See owns. The ban also applies to heads of departments, secretaries, sub-secretaries and executives. The decision is due to the need to meet the needs of the many needy.

In the Rescriptum, the Holy Pontiff explained that “to meet the growing commitments that the Holy See is facing for the fulfilment of the service of the Universal Church and the needy, he asks that greater resources be allocated and reserved to the Apostolic See, also by increasing revenues to the real estate management”.

Therefore, the properties owned by the Vatican can no longer be granted free of charge or on advantageous terms to cardinals and senior executives. Still, the owner entities will have to apply the same rates applied to those who do not hold offices in the Holy See or the Vatican City State. The provision also applies to the Domus, which will have to establish the ordinary rates. Although it is not retroactive, it will apply to all existing contracts which must be extended or renewed.

Who manages the real estate assets of the Vatican?

The real estate assets of the Holy See are managed by ASPA, the Vatican dicastery that also manages the financial assets. The dicastery is chaired by Nunzio Galantino, who, in an interview with Vatican News, did the accounts of the real estate units owned by the Vatican both in Italy and abroad.

How many properties does the Vatican own?

According to what was reported with data referring to the year 2021, there are 4,086 real estate units owned by the Vatican for a commercial area of ​​approximately 1.5 million m2. The net profit realised is 8.11 million euros. The real estate assets are divided into the following types of portfolio: free market (1,866 units corresponding to 391,360 m2, 27% of the total), subsidised rent (1,249 units corresponding to 195,074 m2, 13%), zero rent (971 units corresponding to 876,630 m2, 60%).

As far as our country is concerned, in 2021, ASPA paid 5.83 million euros for the IMU and 2.57 million euros for IRES.

The EU has ordered Italy to have the Church pay the ICI that has never been paid.

The Catholic Church had a total exemption from ICI, on the decision of the Berlusconi government, from 2006 to 2011. After a lengthy legal debate, the European Commission decided: that Italy must recover the unpaid taxes in those years.

Italy will have to recover the ICI – the old municipal tax on real estate – which the Catholic Church has never paid. The European Commission ordered this following a ruling by the European Court of Justice in 2018. The tax exemption for Vatican real estate, decided by the Berlusconi government in 2005, was illegal state aid for the Court, and now the missing sums will be recovered.

Why did the church not pay the ICI from 2006 to 2011

On the other hand, the municipal property tax was a tax in force from 1993 to 2011. In 2005, the Berlusconi government decided that the Catholic Church should not have paid it for its properties, as it was a non-commercial institution. The exemption, however, also concerned the properties that the Church used to carry out activities of a commercial nature. Thus, from 2006 to 2011, the Vatican did not pay the ICI.

In 2012, the Brussels authorities clarified that the exemption for the Church was illegal state aid, not compatible with the laws of the European Union. However, according to the decisions of the time, Italy needed the means to recover the missing taxes: the land register data and the tax information did not clearly identify who should have paid and how much.