Introduction to the New Tax Credit Scheme
A new tax credit scheme has been introduced, offering up to 45% savings on investments that meet the dual requirements of the Transition 5.0 plan. This initiative is designed to encourage energy-efficient investments by providing substantial financial incentives. The credits are structured in three levels, each corresponding to different tiers of energy consumption reduction, and apply to investments up to 50 million euros per year.
Eligibility and Timeframe
Projects that are eligible for these tax credits must be initiated from January 1, 2024, and completed by the end of 2025. These projects should involve capital goods listed in Annexes A and B of Law 232/2016, which pertain to Industry 4.0. The credits are an alternative to the bonuses provided by Law 178/2020 and are governed by Article 38 of Decree-Law 19/2024.
Levels of Tax Credits
The tax credits are structured in three levels, each offering different percentages based on the extent of energy savings achieved. The first level requires a minimum energy consumption reduction of 3% in the production structure or 5% in the processes involved in the investment. The credits for this level are set at 35%, 15%, and 5% for investment tiers up to 2.5 million euros, between 2.5 and 10 million euros, and between 10 and 50 million euros, respectively.
Higher Levels of Savings
For projects that achieve higher levels of energy savings, the credits increase. If the energy savings exceed 6% in the production structure or 10% in the processes, the credits rise to 40%, 20%, and 10% for the same investment tiers. The highest level of credits is available for projects that achieve more than 10% savings in the production structure or 15% in the processes. These projects can receive credits of 45%, 25%, and 15% for the respective investment tiers.
Example Calculation
To illustrate, consider a project involving two new lines of 4.0 machinery costing 14 million euros, which achieves a 6.5% energy reduction in the entire facility. This project would qualify for the second level of tax credits, resulting in a total credit of 2.9 million euros. This is calculated as follows: (2,500,000 x 40%) + (7,500,000 x 20%) + (4,000,000 x 10%).
Spending Cap and Project Limits
The scheme imposes a spending cap of 50 million euros per project and per taxpayer, applicable to the year the project is completed, regardless of the start date. Only one eligible innovation project can be initiated per production site unless previous projects have been completed and the tax credits have been allocated.
Strategic Planning for Multiple Projects
For taxpayers with multiple eligible projects exceeding the 50 million euro cap, it is advantageous to complete these projects in different years to maximize the benefits. For instance, if two projects costing 15 million and 45 million euros are initiated in 2024, completing one in 2024 and the other in 2025 allows for the full cost to be eligible for tax credits.
Final Considerations
The actual amount of tax credits awarded is subject to the availability of resources as outlined in Article 12 of the Decree. The process involves a complex procedure of pre- and post-communication with the GSE to determine the final amount of credits. This ensures that taxpayers are informed of the exact credits they are entitled to receive.
