Don't tip in Italy, just round up the bill.

A while back I was with a girlfriend in Italy who tried to tip a cab driver and he actually refused the tip.

I'm very much an advocate of "When in Rome ... " and agree with the others who encourage you to avoid spreading the tipping disease.

As for your guide, I have a driver on the Amalfi Coast who I've used many times. I don't tip him either, but I do pay him in cash even though he takes credit cards. I think he appreciates the ability to not have to report the income and that basically is a nice tip for him.

BTW, many stores in Italy will give you a discount if you either pay in cash or ask about VAT refund (they'd rather give a discount than deal with the paperwork of that).

Also, know that you will be charged more for your food at a cafe if you sit than if you stand at the counter.