Why must pay in cash instead?
 

I booked apartment, car service etc with my CC and I assumed that CC will take care of the remaining balance but I found out that I must hand over CASH upon arrival for car service and apartment seperately. Why?

Why not CC? Thank you in advance to explain why.

Ciao

Without knowing what service you used nor the fine print on the site, in general Italians, and frankly Europeans in a more general sense, are less credit card friendly than in North America (I presume AZ is Arizona and not Alitalia in your name). Credit cards charge fees for their use. Italians don't want to pay that fee; also cash is much easier to "hide" than credit or even bancomat cards.

italy is notorious for tax avoidance. cash is king. if you have followed any of my posts, you will note that i do a lot of atm cash withdrawals.

chaio baby, or is it caio? ciao maybe?

It's not necessarily a tax dodge for payment to be made in cash. You should still receive a fiscal receipt regardless of payment. Taxes are very high in Italy so people are not willing to lose 3-5% of their profits to a credit card processing fee. Every apartment I have rented in Europe required cash. I'm sure there are places that accept credit cards but I never it to be a big enough issue to seek them out.

Payments by cash have been drastically limited by recent laws.
Cash is still widely used for small, medium amounts. There's no incentive at all by CC issuers to let the petty payment flow, both for business owners and consumers.
In any survey Amex requires me to submit on a monthly frequency I try to let them understand the many flaws their programme has.
One for all, the robbery of 1 MR point every 5 transferred to many airlines FFP.
It translate in a penalty of 25% for award flights.
US folks churn and enjoy bonus transfer bonanza, in Europe they act diametrically at the opposite.

As others have said, credit card companies charge fees and small business operators don't want to pay them. It's really a different mindset in Rome - I was just there for a week and never once used a credit card. My ATM card has a high limit so we just withdrew cash as needed (and do let your bank know in advance that you will be using ATM's out of the country) and we paid cash for all our expenses.

Some restaurants take credit cards, but quite a few don't, so check ahead of time when you dine out. Heck, quite a few stores we were in didn't even take credit cards.