The strong increase in foreign investment flows to Italy is partly the result of a more friendly tax regulation. This is why the Italian Revenue Agency debuted yesterday at the roadshow ‘Invest in Italy' in London to present the new regulation and its advantages - first and foremost clarity, certainty and transparency.
“The message is that with the new tax framework, investors can plan and know what is the correct taxation model before doing a transaction,” Annibale Dodero, Director of Regulation at the Italian Revenue Agency told Il Sole 24 Ore-ItalyEurope24.
“We are participating for the first time in this roadshow because the tax reform rules have been implemented and it's now time to learn about them. We promote the spontaneous adoption, because if investors know in advance what the rules are, they won't risk inspections and fines at a later stage,” he said.
Italy's scenario is positive. Investment flows increased by 21% this year, led by the United States and China, and are aimed mostly to financial services, consumer goods and manufacturing.
The Italian Trade Agency (ITA) organized the London roadshow to accelerate the positive trend and provide investors with all the necessary information. Among the most interesting tax incentives introduced by the tax revenue agency is the preliminary opinion on new investment: those looking to invest at least €30 million in Italy can know in advance the tax treatment of their investment plan and planned extraordinary transactions.
Dodero explained the strategic importance of other tax incentives like the Patent Box , which facilitates the management of immaterial assets, and the introduction of ACE, an incentive to the capitalization of companies, rebalancing the tax treatment of businesses that fund themselves through debt, and those who fund themselves with their own capital.
Another notable initiative is the adoption of tax credits reserved to businesses that commit to invest in research and development. Last but not least, Dodero noted that next year the capital gain tax is expected to be further lowered, from 27.5% to 24%.
Anna Gervasoni, chief executive of AIFI, the Italian Private Equity Association, explained that the number of mergers and acquisitions of Italian companies by foreign companies confirms the attractiveness of the Italian model.
“Tax treatment is always on the front line - and it's therefore positive that many problems have been resolved and there is now a clear and understandable framework that incentives acquisitions,” Gervasoni said.
At the roadshow, ITA also announced the signing of an agreement with AIFI to help Italian companies meet with foreign investors by offering them a larger, more diversified, quality portfolio. The agreement will allow to follow up on many requests from investors who need specialized financial experience in the private equity and venture capital sectors.
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