The Italian 2007 Budget Law provides for a new special tax vehicle, namely the real estate investment company. In addition, the law contains new tax provisions on trusts which are far from comprehensive, but establish important principles on their classification and tax treatment. Other recent changes to tax laws relate to: a tax-free basis step-up in incorporations and corporate reorganizations; new limitations on the use of tax losses; the taxation of employee stock option plans and non-operating companies; and estate and gift taxes.