The 2016 Stability Law established a tax credit, effective January 1, 2016, and valid until December 31, 2019, for the purchase of new capital goods for production facilities located in the Southern regions (Campania, Puglia, Basilicata, Calabria, Sicily, Molise, Sardinia, and Abruzzo).
The 2020 budget law (Article 1, paragraph 319, of Law No. 160 of 27 December 2019) extended the aforementioned deadline to 31 December 2020.
The 2021 budget law (Article 1, paragraph 171 of Law No. 178 of December 30, 2020) further extended the measure until December 31, 2022.
The incentive instrument has been operational since 30 June 2016. Companies intending to benefit from the tax credit must submit a communication electronically to the’Revenue Agency (Revenue Agency provision of 14 April 2017, amended in the first instance with a provision of 29 December 2017 and in the second instance with a provision of 9 August 2019).
The Revenue Agency, after verifying the data declared in the communication, sends the companies the authorization to use the tax credit.
The National Operational Programme “Enterprises and Competitiveness” 2014-2020 ERDF contributes to the tax credit intervention by making available, to in favor of SMEs that have received authorization from the Revenue Agency to benefit from the tax credit, from a minimum of 161.8 million euros to a maximum of 306 million euros.
With Ministerial Decree of July 29, 2016, as amended by Ministerial Decree of August 9, 2017, resources amounting to 161.8 million euros have been allocated, in the initial application phase, under Axis III – “Competitiveness of SMEs” of the PON, of which 123 million are allocated to the “less developed” regions (Basilicata, Calabria, Campania, Puglia and Sicily) and 38.8 million are allocated to the “transition” regions (Abruzzo, Molise and Sardinia).
Beneficiaries
Small and medium-sized enterprises that have received authorization from the Revenue Agency to use the tax credit in relation to investment projects concerning the acquisition of new capital goods and meeting the specific eligibility criteria defined in art. 4 of the PON tax credit can benefit from the tax credit. Ministerial Decree of July 29, 2016 and relating to:
- minimum investment amount (500 thousand euros)
- excluding only economic activities in the agriculture, forestry and fishing sectors
- location in less developed regions or in transition regions
- attributability of investments to the application areas of the National Smart Specialization Strategy
Investment projects by SMEs in Southern Italy that meet the aforementioned eligibility criteria are subjected to a specific assessment by the General Directorate for Business Incentives, which assesses their co-financing with resources from the PON IC.
The directorial decree of 4 January 2017 established the procedures for assessing the eligibility of investment projects for the use of PON resources and for communicating the decision to use the resources, as well as the requirements following the signing of the decision and the additional obligations for beneficiary companies.
The Directorial Decree of 23 April 2018 regulated the procedure for admission to PON resources with reference to the acquisitions of new capital goods carried out starting from 1 March 2017, following the changes introduced to the tax credit measure by Article 7-quater of Legislative Decree no. 243/2016, by the provision of 14 April 2017 and by the provision of 29 December 2017.
The investment completion date, originally set for December 31, 2019, has been extended to December 31, 2022 by the recent Law no. 178 of December 30, 2020 – State Budget Forecast for the 2021 Financial Year and Multi-Year Budget for the Three-Year Period 2021-2023.
Article 5 of the Ministerial Decree of 23 April 2018 redefines the reporting obligations for expenditures of SMEs benefiting from the PON tax credit, modifying the deadlines and forms to be used for all projects eligible for co-financing with PON resources.
Please note that the provisions set forth in the directorial decree of 23 April 2018, including those relating to reporting obligations (Article 5 of the directorial decree of 23 April 2018), apply exclusively to projects eligible for co-financing with resources from the PON IC, for which the beneficiary SME receives from the Ministry of Economic Development the Provision for the use of PON IC resources, pursuant to Article 5 of the Ministerial Decree of 29 July 2016.
Therefore, with regard to projects not eligible for co-financing with PON resources, for which, however, the authorization to benefit from the tax credit issued by the Revenue Agency using national resources remains in place, the beneficiary companies they do not have to report to the Ministry of Economic Development the costs of acquiring the fixed assets envisaged in the Communication for use.
Regions
For the purposes of implementing the interventions financed by the 2014-2020 ERDF operational programs, the Ministry of Economic Development – General Directorate for Business Incentives – has assumed the role of intermediary body for the management of the tax credit for investments in Southern Italy in the regions listed below, pursuant to Article 123, paragraphs 6 and 7, of Regulation (EU) No. 1303/2013. To manage the incentive instrument, specific agreements have been signed between the Ministry and the interested regions.
The regulatory documents relating to the Molise and Campania regions are available below.
Molise
The POR Molise ERDF ESF 2014/2020 contributes to the incentive instrument "tax credit for investments in Southern Italy" with a financial allocation of 2 million euros under Axis 3, Specific Objective 3.1 - "Reviving the propensity for investment in the production system".
The aforementioned resources are intended for SMEs that have already received authorization from the Revenue Agency to benefit from the tax credit.
With directorial decree of 11 December 2018 The selection, admission, and reporting procedures for investment projects implemented in the assisted areas of the Molise Region have been defined.
Campania
The POR Campania ERDF 2014/2020 contributes to the incentive instrument “tax credit for investments in Southern Italy’ with a financial allocation of 25 million euros under Axis 3 of the POR Campania ERDF 2014-2020, Specific Objective 3.1 ”Relaunching the propensity for investment in the production system“, Action 3.1.1”.
The aforementioned resources are intended for SMEs that have already received authorization from the Revenue Agency to benefit from the tax credit.
With directorial decree of April 19, 2019 The selection, admission, and reporting procedures for investment projects implemented in the assisted areas of the Campania Region have been defined.
Calabria
The Calabria Regional Operational Programme (ROP) ERDF ESF 2014/2020 contributes to the incentive instrument "tax credit for investments in Southern Italy" with a financial allocation of 20 million euros for Axis III, Specific Objective 3.1 - "Reviving the production system's propensity to invest".
The aforementioned resources are intended for SMEs that have already received authorization from the Revenue Agency to benefit from the tax credit.
With directorial decree of December 2, 2019 The selection, admission, and reporting procedures for investment projects implemented in the assisted areas of the Calabria Region have been defined.