Withholding Tax Agent (Employer)
Plain English
It's a person or company that withholds tax on payments to others and forwards it to the Italian tax authority. Employers are sostituto d\'imposta for their staff: they withhold IRPEF from each pay slip and send it to the state.
Why it matters
Thanks to sostituto d\'imposta, most employees don\'t need to deal with monthly tax payments themselves. The employer also issues the CU every year and applies your 730 refund or balance directly through the pay slip.
Common confusion
Some payments by Italian businesses to freelancers also involve a ritenuta d\'acconto, a withholding done by the client. Freelancers see this in their invoices and account for it at year-end.
Official source
Agenzia delle Entrate