Italy Tax Agency Clarifies Tax Credit Rules for Investments in Industry 4.0 Tangible Assets

The Italian Revenue Agency May 21 issued Letter No. 109/2024, clarifying tax credit rules for investments in new capital assets for production facilities located in Italy. The taxpayer, a company, rented a plant from a lessor. The rental contract didn’t have a redemption clause or redemption price to avoid classification as an installment contract. The parties left any purchase of the plant following the rental-to-side agreements. The taxpayer used the rental period to test the functionality of the plant machinery. It sought clarification as to whether it would be eligible for tax credit on the purchase of the plant, an ...