Tax regulation mechanisms I (Reduction in value-added tax)
Updated: 07.02.2019
Author: Jasmin Schwarz
Since 1993, Italy has promoted the generation of electricity from wind and solar energy through a reduction of 10% on the value-added tax (l'aliquota agevolata del 10 per cento) for deliveries and services related to investments in wind power plants and solar energy installations and investments in grids that distribute this electricity.
Eligible technologies
Investments in wind power plants and solar energy installations and investments in grids that distribute this electricity are eligible (Art. 127-quinquies DPR 633/72, table A).
| Wind energy | Eligible. |
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| Solar energy | Eligible. |
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Amount
The reduced value-added tax rate is 10 % (instead of 20 %).
Addressees
Entitled party. The entities entitled are private individuals (Art. 1 DPR 633/72).
Procedure
Process flow | The entitled parties will be directly charged with the lower VAT. |
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Distribution of costs
| State | The reduced VAT rate on deliveries and services related to investments in renewable energy plants leads to a lower state revenue, which is compensated for by other revenue. |
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Italy
