appendix to 2016 national reform programme€¦ · reform of civil justice (d.l. no. 132/2014, cvt....

Reform timetable and summary of Italian reform measures

Appendix to 2016 National Reform Programme

Appendix to 2016 National Reform Programme

Reform timetable and summary of Italian reform measures

Submitted by Prime Minister

Matteo Renzi

and Minister of the Economy and Finance

Pier Carlo Padoan

Adopted by the Cabinet on 8 April 2016

Structural reform agenda - timetable

Appendix A

APPENDIX TO NRP 2016

MINISTERO DELL’ECONOMIA E DELLE FINANZE 7

REFORM TIMETABLE

Policy Area Done In progress Timetable

Institutional

reforms

Electoral Law Chamber of Deputies (L. no. 52/2015)

May 2015

Implementation Law of L. no. 52/2015: Definition of

electoral constituencies for the Chamber of Deputies August 2015

Bill for Constitutional Reform (overcoming the

perfect bicameralism and modification of legislative

powers’ allocation between State and Regions). April 2016

Confirmatory referendum on constitutional reform

By 2016

Bill on the prevention of conflict of interest for

Deputies and Government members (A.S. 2258).

Labour market

and social

policies

Enabling Law on labour market reform (L. no.

183/2014). December 2014

Implementing decrees of L. no. 183/2014

March 2015 Legislative decree on standard open-ended contract

(Lgs. D. no. 23/2015)

Legislative decree on new unemployment benefit

scheme (Lgs. D. no. 22/2015).

Legislative Decree on work-life balance (Lgs. D. no.

80/2015)

June 2015

Legislative Decree on labour contracts and review of

tasks’ regulation (Lgs. D. no. 81/2015)

Legislative Decree on wage supplementation

scheme (Lgs. D. no. 148/2015)

September 2015

Legislative Decree on rationalization and

simplification of inspection activities (Lgs. D. no.

149/2015)

Legislative Decree on labour services, active policies

and setting up of National Agency for active labour

policies- ANPAL (Lgs.D. no. 150/2015).

Legislative Decree on simplification of procedures

and equal opportunities (Lgs. D. no. 51/2015)

Implementation of Lgs. D. no. 150/2015

Definition of the strategy implementing the new

ALMPs and agreements with the regions.

Implementation of the ALMPs strategy and issuance

of activation vouchers for dedicated training paths.

By 2016

Prime Minister Decree transferring resources from

Ministry of Labour and ISFOL to ANPAL

May 2016

Enabling law to reform the non-profit sector, the

social enterprise and the universal social service

service (approved by the Senate and now before the

Chamber of Deputies)

Adoption of the ANPAL statute June 2016

ECONOMIC AND FINANCIAL DOCUMENT - SECTION III NATIONAL REFORM PROGRAMME

8 MINISTERO DELL’ECONOMIA E DELLE FINANZE

REFORM TIMETABLE (CONTINUE)


Labour market

and social

policies

Youth Guarantee - First Phase

May 2014

Youth Guarantee - Second Phase (“Superbonus”;

and “selfiemployment”) March 2016

Interventions on the second level contractual bar-

gaining. By 2016

Bill on Jobs Act for self-employed workers and for

flexible organisation of job’s time for work-life bal-

ance. Approved by the Council of Ministers January

28,. 2016- now before the Senate (AS 2233).

By September

2016

Enabling Law for the reunification and coordination

of the legislation on support to family. Single Family

Code December 2016

Refinancing of the Plan for the early childhood’s ed-

ucational services

Justice

Delegated law on non-prison penalties and reform of

the sanction system (L. no. 67/2014) April 2014

Reform of criminal justice (D.L. no. 92/2014 cvt. L.

no. 117/2014) August 2014

Reform of civil justice (D.L. no. 132/2014, cvt. in L.

no. 162/2014) November 2014

Provisions on crimes against the Public Administra-tion, ‘mafia’ association and false accounting (L. no. 69 /2015)

May 2015

D.L. no. 83/2015 cvt. L. no. 132/2015. Urgent

measure on bankruptcy, civil procedure, judicial or-

ganization and functioning of the judicial administra-

tion

June 2015

Implementation of L. no.67/2014:

Provisions on de-criminalisation (Lgs. D. no. 7/2016)

January 2016

Measures to deflate the criminal justice system

(Lgs.D. no. 8/2016)

Bill to modify the criminal legislation for strengthen-

ing of the defensive guarantees and the reasonable

duration of proceedings, already passed by the

Chamber, currently before the Senate (AS2067)

August 2016

Bill to reinforce the jurisdiction of firms and family

courts; rationalisation of civil trials; revision of pro-

ceedings stages. Already passed by the Chamber,

currently before the Senate (AS2284) October 2016

Bill on statute of limitations, already passed by the

Chamber, currently before the Senate (AS1844)

Enabling law for the reform of the honorary

magistrates and other provisions for justice of the

peace (A.C.3672)

June 2016





Justice

Bill delegating the Government to reform the rules

on corporate crisis and insolvency procedures, ap-

proved by the Council of Ministers February 10,

2016, currently before the Chamber (A.C. 3671)

October 2016

Bill on measures to fight organized crime and illicit

patrimonies (A.S. 1687) By 2016

Provisions on crimes against the Public Administra-

tion, ‘mafia’ association and false accounting (L. no.

69/2015)

May 2015

Fiscal System

Enabling Law on tax reform

(L. no. 23/2014). March 2014

Enabling legislative decrees of L. no 23/2014 on:

November 2014 Fiscal simplification and pre-compiled income tax

return (Lgs.D. no. 175/2014).

Tobacco products (Lgs. D. no. 188/2014)

December 2014

Revision of Cadastral committees (Lgs. D. no.

198/2014).

Cadastre: The revision of cadastral values will be

subject to a general and organic intervention after

an alignment of the databases needed to accurately

assess the revenue and distributional effects on

taxpayers.

2016-2018

Legal certainty between tax authorities and taxpay-

ers (Lgs. D. no. 128/2015) August 2015

VAT electronic invoicing (Lgs. D. no. 127/2015)

Simplifying taxation for international businesses

(Lgs. D. no. 147/2015) September 2015

Simplification of collecting system(Lgs.D. no.

159/2015)

October

2015

Monitoring of tax evasion (Lgs. D. no. 160/2015)

Sanction system (Lgs. D. no. 158/2015)

Litigation procedures (Lgs.D. no. 156/2015)

Reorganisation of fiscal agencies (Lgs. D. no.

157/2015).

Taxation

VAT and taxation on capital gains

(D.L. no. 66/2014 cvt. in L. no. 89/2014). June 2014

Permanent reduction of tax wedge on labour

(2015 Stability Law – L. no. 190/2014).

December 2014

Reform of the local taxation on properties (IMU) and

indivisible services for principal residences (TASI)

(2016 Stability Law - L. no. 208/2015).

IRPEF: with the next Budget Law it will be evaluated

the possibility of acting on IRPEF according to the

available public finance space.

2017-2018





Taxation

Reduction of corporate taxation (2016 Stability Law:

reform of local taxation on farmland and on “bolted

equipment”; reduction of IRES at 24% in 2017)

December 2015

Fiscal measures to boost investments (2016 Stabil-

ity Law: amortisation of 140% for the purchase of

capital goods; exclusion of instrumental properties

from the firm’s assets)

Tax measures of VAT regime and taxation of busi-

ness income 2016

Privatisation

Selling of public shares: Listing of Fincantieri (from

CDP); dismissal of CDP Reti share; divestiture (from

CDP) of Trans Austria Gasleitung GMbH – Tag; List-

ing of RAIWay.

2014

Selling of further shares of ENEL, IPO of Poste

Italiane. 2015

ENAV, Ferrovie dello Stato. Further privatizations

under consideration 2016-2018

Infrastructure

National Plan for Ports and logistics (Prime Minister

Decree 26 Aug. 2015; as foreseen in D.L. ‘Sblocca

Italia’ cvt. L. no. 164/2014)

Agreement of 31 March 2016 in State-Regions Con-

ference after the judgement of Constitutional Court.

August 2015

Identification of national interest airports (Presiden-

tial Decree no. 201/2015) September 2015

National Plan for social and cultural re-development

of deprived urban areas (the 2015 Stability Law). Prime Minister Decree for the establishment of the

Committee for the evaluation of projects

October 2015

Contributions for intermodal combined transport

services (2016 Stability Law – “FerroBonus” and

“MareBonus”)

December 2015

National Plan for Defence and security (cyber securi-

ty, defence systems, police forces – 2016 Stability

Law - L.no. 208/2015)

Enabling law for the reform of public tenders (L. no.

11/2016)

January 2016

Implementation of Law no. 11/2016.

April 2016 Delegated Legislative Decree no. 50/2016 to im-

plement EU Directives 23, 24 and 25 of 2014 and

review public tender legislation.

Ultra-Broadband Plan (2020 target: 85% of popula-

tion covered with connection of at least 100Mbps) 2015-2020

Implementation of the Ultra - Broadband Plan.

Agreement with the Regions on the joint use of re-

gional and national resources and the DCF alloca-

tion

February 2016

Extraordinary Plan for the redevelopment of periph-

eries (Stability Law 2016) By 2016





Infrastructure

Measures for the improvement of urban quality.

Recovery program for the residential public build-

ing. University residences realization. New invest-

ment for underground. Interventions for the devel-

opment of cycle-stations and soft mobility facilities.

National Plan for electric vehicle recharging.

By 2016

Competition and

competitiveness

Measures for productive investments: ‘Nuova Sa-

batini’ (D.L. no. 69/2013); ‘Competitiveness De-

cree’ (D.L. no. 91/2014); ‘tax credit for R&D in-

vestments; Patent box

December 2015

Extension of incentives for firms signing network contracts; incentives for specific networks (green and international); support for “catalyst subjects” and regulatory simplification.

By 2016

Provisions for relaunching of firms investment

June 2016 Strengthening of Central Guarantee Fund for SMEs

2015 Annual law on competition (A.S.2085).

2016 Annual law on competition. December 2016

Plan for relaunching Italian manufacturing

By 2016 Strengthening of incentives for start-up and innovative SMEs

Extraordinary Plan for Made in Italy 2015-2017

National Plan to fight counterfeiting 2016-2017

Credit

Reform of ‘Banche Popolari’

(D.L. no. 3/2015 cvt. in L. no. 33/2015). March 2015

Measure on non-performing loans and bankruptcy

(D.L. no. 83/2015 cvt. in L. no. 132/2015). August 2015

Transposition into national law of the European

Directive 2014/59/EU on Bank Recovery and Res-

olution

November 2015

20% of Guarantee Fund to firms located in the

South (Stability Law 2016) December 2015

Cooperative banks’ reform; State guarantee mech-

anism as part of securitization transactions whose

underlying assets are banks’ non-performing loans

(D.L. no. 18/2016). February 2016

Implementation of directive 2014/49/UE on de-

posit guarantee schemes (Lgs.D. no. 30/2016)

Self-reform of Foundations. 2015 - 2016

‘Finance for growth’ measures: mini bond (D.L. no.

83/2012); simplification for SMEs listing (D.L. no.

91/2014); allowance for corporate equity (ACE and

superACE - D.L. no. 201/2011; L. no. 147/ 2013)

2012 - 2016

Measures ‘Finance for growth 2.0’ By 2016





Education

‘La buona scuola’ reform

(L. no. 107/2015). July 2015

Implementing decrees of Law no. 107/2015. Leg-

islative Decrees on:

- National education and training system;

- Initial training and access to teaching positions

in secondary school;

- Promotion of inclusion in schools for students

with disabilities and recognition of different forms

of communication;

- Review of vocational education pathways and

link with education and training pathways;

- Integrated system of education and school from

zero to six years;

- Effectiveness of the right to education;

- Promotion and dissemination of culture and

support to creativity;

- Italian educational institutions and initiatives

abroad;

- Evaluation and certification of students skills.

July 2016

Strengthening of measures for school building:

EIB loans (L. no. 107/2015) and exclusion of

the costs of school building projects from the

budget balance of local authorities (Stability Law

2016)

July – December 2015

National Plan for digital school. 2015

National Plan of training on the job (ministerial

decree by May 2016) 2016-2018

National Plan for Research 2015-2020 2016

Decree for the Charter of Rights and duties of

students in school – work training By June 2016

Public

Administration and

simplification

Simplification Agenda 2015-2017: (including the

simplification measures of L. no. 124/2015) 2015-2017

Enabling Law on reforming the Public Admin-

istration (L. no. 124/2015). August 2015

Implementing legislation of L. no. 124/2015:

Lgs. D. no. 10/2016 on repeal of obsolete and

out of date secondary legislation and implement-

ing decrees.

January 2016

Further 11 legislative decrees implementing

L.124/2015, approved by the CoM of January

22, 2016, related to:

1) digital citizenship and Code of Digital

Administration.

2) reorganisation of State-Regions Services’

Conference;

3) simplification and acceleration of

administrative procedures;

4) regulation of Segnalazione Certificata di Inizio

Attività (SCIA);

5) revision and simplification of regulation on

public corruption and transparency

August 2016

(final approval)





Public

Administration and

simplification

6) rationalisation and simplification of ports’

authorities;

7) reorganisation of state forestry and police

corps;

8) Transparency on Health System Managers

9) Changes on dismissal rules on Public

employment

10) Single code on local public services

11) Reorganisation of rules on State Owned

enterprises

August 2016

(final approval)

Further legislative decrees to fully implement L.

no. 124/2015 on:

- transparency and prevention of corruption;

- Simplification and acceleration of administrative

procedures;

- Reform of public management;

- Chambers of Commerce reform;

- Reorganization of procedures for the

judgements before the Court of Auditors;

- Reorganization of the Presidency of the Council

of Ministers, government agencies and non-

public economic entities.

August 2016

One or more legislative decrees for the reorgani-

zation of labour legislation in the public admin-

istrations

February 2016

Implementation of the Defence White Book: Fur-

ther revision of the National Military Forces, re-

configuration and streamlining of internal organi-

sation of the Defense Ministry, the redefinition of

careers.

By 2016

Reducing regional

disparities

Masterplan for the Mezzogiorno 2015

Implementation of the Masterplan: 16

Agreements for the South: 8 for the South

Regions and 8 for Metropolitan cities to define

specific strategic actions for each territory.

2015-2018

Tax credit for investment in capital goods in the

South (Stability Law 2016) December 2015

Poverty and social

inclusion

Enabling Bill attached to the Stability law, provid-

ing measures to fight poverty and reorganize so-

cial services (approved by the CoM on 28nd Jan-

uary 2016 and now before the Chamber

(AC3594)

June 2016

Bill on assistance for persons with severe

disabilities without family support (Law “Dopo di

noi” - A.S.2232) July 2016





Agriculture

Implementation and simplification of the Common

Agricultural Policy

Adoption of all not legislative implementing act:

MD no. 162/2015 Simplification of the CAP 2014 -

2020 management;

MD Ref. 1922/2015 Additional provisions regard-

ing the simplification of the management of the

CAP 2014 - 2020;

MD no. 5145/2015 National regulations for the

implementation of delegated Regulation (EU)

2015/1383 of the Commission of 28 May 2015

March 2015

Measures for the milk and dairy industry (D.L. no.

51/2015 cvt. into L. no. 91/2015). May 2015

Implementing legislation of the D. L. no. 51/2015:

Urgent provisions to favouer the reorganisation of

the milk and dairy industry and for the implementa-

tion of the EU regulation 1308/2013 related to in-

terprofessional organisations in the agricultural

sector.

By 2016

Rules for transparency of contractual agreements

in agricultural supply chains. June 2016

Support measures for agricultural sector (Stability

Law 2016): IRAP exemption, IMU exemption for

farmland, tax credit for the purchase of capital

goods for production facilities, fund for agricultural

machinery, agro-energy tax, extension of the

National Program of Fisheries and Aquaculture.

December 2015

Enabling law for simplification, rationalisation and

competitiveness of agricultural, agri-food and

fishing sectors (before the Senate – A.S. 1328 B). July 2016

Healthcare

Strengthening of Health Pact 2014-2016

(EAL, reference prices, drugs) December 2015

Health responsibility (AS2244) By 2016

Culture and Tour-

ism

Young Culture Card, tax credit for filmmaking indus-

try, stabilisation of Art Bonus, 2x1000 to cultural

associations (Stability Law 2016)

December 2015

Bill attached to the Stability Law 2016 on Regula-

tion of Cinema, Audiovisual and Performing Arts"

(A.S.2287) By 2016

Reform of RAI and TV public service December 2015

Update of the Strategic Plan for tourism develop-

ment and the relaunch of ENIT By 2016

Environment

Law on crimes against the environment (L. no.

68/2015).

May 2015

Law to promote green economy measures and for

the containment of excessive use of natural re-

sources (L. no. 221/2015)

December 2015





Environment

Implementing legislation of L. no. 221/2015:

L.D. concerning the remuneration of ecosystem

and environmental services. By 2016

Remediation and environmental damage: simplifi-

cation of remediation process; reform of SIN man-

agement

Waste management: regulatory authority and pro-

gressive transition from tax (Tarsu) to tariff; Reform

of the consortia

June-December

2016

Hydro-geographic districts November 2016

Green Act Bill (environmental taxation; circular

economy, renewables, mobility) By 2017

Reform of the governance of National Parks (AS

1034) November 2016

Spending Review

and tax expendi-

tures

With the new regulatory framework for tax expendi-

tures (Lgs. D.no. 160/2015, implementing Ena-

bling Law no. 23/2014) the Gov.t will annually re-

view existing tax expenditures according to their

economic impact and present a Report to Parlia-

ment together with the Budget Law.

October 2015

Spending review – Phase I (rationalisation of pur-

chasing centres, processes digitalisation and

standard costs) savings achieved: €3.6 billion in

2014 and €18 billion in 2015

2015 Strengthening the programme of rationalization for

e-procurement and of the central buyers bodies

(‘centrali di committenza’); setting up of the

‘aggregators Table’; extension of the obligations for

the PA and its subsidiaries to use Consip (the

National e-procurement Agency) for their

purchases.

Annual decrees on market categories and maxi-

mum thresholds for independent tenders (if ex-

ceeded authorities must resort to Consip or to an-

other party aggregator).

Definition of new benchmark prices based on

‘essential characteristics’ of the goods and

services

By 2016

Standard requirements and fiscal capacity rules

(Fiscal Federalism) for local authorities.

Updating of the methodological notes

Phase II of spending review (revision of Budget

Law).

Estimated savings: €25 billion in 2016, €28 billion

in 2017 and €29 billion in 2018.

Structural savings

planned until 2018.

Bill modifying L. no. 243/2012 providing for the

implementation of the principle of balanced budget

for regional and local authorities. July 2016

Note: Reforms are divided according to their progress in two categories, i) those presented before the Parliament approval (in progress)

and ii) those who have already completed the process of approval and have been published in Official Journal (done)

Summary tables of macroeconomic impact of reforms

Appendix B



MACROECONOMIC EFFECTS OF REFORMS IN PUBLIC ADMINISTRATION AND SIMPLIFICATION AREA

Related legislation

Methodological elements

Quantitative elements

D.L. no. 90/2014, cvt. into L. no.

114/2014- “Misure urgenti per la

semplificazione e la trasparenza

amministrativa e per l'efficienza

degli uffici giudiziari” (Artt. 1 – 15;

Artt.16-23; Artt. 24 – 26; Artt.43,

44, 47, 49)

L. no. 124/2015 – “Delega per la

riorganizzazione delle

Amministrazioni Pubbliche” (Art.

1; Art. 13)

Simplification Agenda 2015-2017

Lgs.D. no. 175/2014 on fiscal

simplification (Lgs.D. no.

175/2014 - Artt.1 - 4, 8, 9; 12-

14; 16 – 17; 19, 22; 26, 28)

2015 Annual law on competition

(Draft Law - A.S. 2085/2015) Artt.

17,29, 30,31

D.L. no. 91/2014 cvt. into L. no.

116/2014 –“Competitiveness

Decree - Disposizioni urgenti per il

settore agricolo, la tutela

ambientale e l'efficientamento

energetico dell'edilizia scolastica

e universitaria, il rilancio e lo

sviluppo delle imprese, il

contenimento dei costi gravanti

sulle tariffe elettriche, nonché per

la definizione immediata di

adempimenti derivanti dalla

normativa europea” (Artt. 20,22

bis, 30)

Main outcome of macroeconomic simulations

Relevant features

of the model

used/estimation

technique

Main

macroeconomic

assumptions/

simulation

assumptions

Description

Yearly and cumulated effect on GDP and

other main macroeconomic variables (6)

2020 2025 2030 LR

DGE Model-

QUESTIII - ITALY;

reference: Griffith,

R. and R., Harrison,

(2004); Lorenzani,

D., Varga, J. (2014)

Reduction of red

tape costs: 18 per

cent; phasing in 10

years

GDP 0.4 0.7 0.8 1.2

Gross capital

formation 0.1 0.3 0.3 0.8

Employment 0.0 -0.2 -0.2 -0.1

Consumption 0.7 0.9 0.8 0.9

Direct fiscal

impact upon

primary balance

0.2 0.4 0.4 0.4

MACROECONOMIC EFFECTS OF REFORMS IN COMPETITION AREA

Related legislation



2015 Annual law on competition

(Draft Law - A.S. 2085/2015),

Artt. 2-4, 10, 11,13,16,18-22,24-

28,33)

L. no. 124/2015 – “Delega per la

riforma delle amministrazioni

pubbliche”(Artt. 14 – 15)


116/2014 – “Competitiveness

Decree - Disposizioni urgenti per il

settore agricolo, la tutela

ambientale e l'efficientamento

energetico dell'edilizia scolastica

e universitaria, il rilancio e lo

sviluppo delle imprese, il

contenimento dei costi gravanti

sulle tariffe elettriche, nonché per

la definizione immediata di

adempimenti derivanti dalla

normativa europea” (Artt.18, 19,

21, 22, 23, 24, 26, 28, 30bis)


Relevant features

of the model

used/estimation

technique

Main

macroeconomic

assumptions/

simulation

assumptions

Description


other main macroeconomic variables

2020 2025 2030 LR

DGE Model-

QUESTIII - ITALY;

reference: Thum-

Thysen A., Canton

E., (2015); Koske,

I., I.Wanner, R.

Bitetti and O.

Barbiero (2014)

Price mark-up

reduction in the

manufacturing

sector and in the

services sector: 1

percentage point;

phasing in 8 years

GDP 0.4 0.7 0.8 1.2

Gross capital

formation 2.0 2.5 2.7 2.9

Employment 0.1 0.1 0.0 0.0

Consumption -0.3 -0.1 0.0 0.3

Direct fiscal

impact upon

primary balance

0.2 0.4 0.4 0.6



MACROECONOMIC EFFECTS OF REFORMS IN LABOUR MARKET

Related legislation



Law no. 183/2014 –Jobs Act -

“Deleghe al Governo in materia di

riforma degli ammortizzatori

sociali, dei servizi per il lavoro e

delle politiche attive, nonche' in

materia di riordino della disciplina

dei rapporti di lavoro e

dell'attivita' ispettiva e di tutela e

conciliazione delle esigenze di

cura, di vita e di lavoro” (Art.1

subpar. 1-9)

Lgs.D.no. 23/2015 –

“Disposizioni in materia di

contratto di lavoro a tempo

indeterminato a tutele crescenti,

in attuazione della legge 10

dicembre 2014, n. 183” to

simplify contractual categories of

workers (Art. 1 – 12) and revision

of their duties (Artt. 1 – 55)

Lgs.D. no. 80/2015 – “Misure per

la conciliazione delle esigenze di

cura, di vita e di lavoro, in

attuazione dell'articolo 1, commi

8 e 9, della legge 10 dicembre

2014, n. 183” (Artt. 1 – 22)


Relevant features

of the model

used/estimation

technique

Main

macroeconomic

assumptions/

simulation

assumptions

Description



2020 2025 2030 LR

DGE Model- IGEM;

reference: Boeri,

T., Garibaldi, P.

2007; Alfonso

Arpaia & Gilles

Mourre, 2009.

Wage mark-up

reduction of 14

percentage points

for permanent

workers; shift from

permanent to

atypical workers of

6.5 percentage

points; phasing in

10 years

GDP 0.6 0.9 1.2 1.3

Gross capital

formation 0.4 0.4 0.6 1.0

Employment 1.0 1.5 2.0 2.0


Total impact

upon primary

balance

0.2 0.4 0.5 0.6

MACROECONOMIC EFFECTS OF REFORMS IN JUSTICE

Related legislation




162 / 2014 – “Misure urgenti di

degiurisdizionalizzazione e altri

interventi per la definizione

dell'arretrato in materia di

processo civile” (Art. 1-13, 16-20)

D.L.no. 90/2014 cvt. into L. no.

114/2014 – “Misure urgenti per

la semplificazione e la

trasparenza amministrativa e per

l'efficienza degli uffici giudiziari”

(Artt.50 - 51)

Draft Enabling Law of enhancing

the delegation of the business of

the court and the court skills of

families and of the person;

rationalizing of the civil process;

revision of the discipline of the

discussion stages and referral in

decision (Art. 1)


Relevant features

of the model

used/estimation

technique

Main

macroeconomic

assumptions/

simulation

assumptions

Description



2020 2025 2030 LR

DGE Model-

QUESTIII - ITALY;

reference:

European

Commission,

2014; Cincera, M.

and O. Galgau

(2005)

Price mark-up

reduction in the

manufacturing

sector and in the

services sector:

0.15 percentage

point; reduction of

user cost of capital

of 5 basis points;

phasing in 3 years

GDP 0.1 0.2 0.3 0.9

Gross capital

formation 0.8 0.9 0.9 2.2

Employment 0.0 0.0 0.0 0.2


Total impact

upon primary

balance

0.1 0.1 0.1 0.5



MACROECONOMIC EFFECTS OF REFORMS IN SCHOOL SYSTEM

Related legislation Methodological elements


L. no. 107/2015 The ‘Buona

Scuola’ Reform – “Riforma del

sistema nazionale di istruzione e

formazione e delega per il

riordino delle disposizioni

legislative vigenti”, Artt. 2 – 14);

2015 Stability Law (Art.1 subpar.

4, 5)


Relevant features

of the model

used/estimation

technique

Main

macroeconomic

assumptions/

simulation

assumptions

Description



2020 2025 2030 LR

DGE Model-

QUESTIII - ITALY;

reference:Janos

Varga and Jan in ’t

Veld, (2014)

Shift from low

skilled workers to

medium skilled

workers by 4.6

percentage points.

Increase of public

expenditure by 3

billions

GDP 0.3 0.6 0.9 2.4

Gross capital

formation -0.5 -0.2 0.3 1.5

Employment 0.2 0.5 0.8 1.1


Total impact

upon primary

balance

0.0 0.1 0.3 1.0

MACROECONOMIC EFFECTS OF TAX SHIFT



2015 Stability Law (Art. 1, subpar.

12, 20)

D.L. no. 66/2014 cvt. into L.

89/2014 – “Misure urgenti per la

competitivita' e la giustizia

sociale“(Art. 3-4)


Relevant features

of the model

used/estimation

technique

Main

macroeconomic

assumptions/simul

ation assumptions

Description



2020 2025 2030 LR

DGE Model- IGEM

Reduction of

labour tax: 0.6 per

cent of GDP;

reduction of social

contributions paid

by businesses: 0.4

per cent of GDP;

increase of

financial income

tax: 0.16 per cent

of GDP

GDP 0.2 0.2 0.2 0.2

Gross capital

formation -0.5 -0.2 -0.2 -0.2

Employment 0.5 0.5 0.5 0.5

Consumption -0.1 0.0 0.0 0.0

Total impact

upon primary

balance

-0.8 -0.8 -0.8 -0.8

MACROECONOMIC EFFECTS OF THE SPENDING REVIEW AND TAX EXPENDITURES



D.L. no. 66/2014 cvt. into L.

89/2014 – “Misure urgenti per la

competitività e la giustizia

sociale“ (Artt. 8, 14, 15, 17, 19,

46, 47)

2015 Stability Law

Improving efficiency of public

expenditure and review of tax ex-

penditures (DEF 2015)


Relevant features

of the model

used/estimation

technique

Main

macroeconomic

assumptions/

simulation

assumptions

Description



2020 2025 2030 LR

DGE Model-

QUESTIII - ITALY

Increase of

consumption tax by

0.075 per cent of

GDP; increase of

labour tax by

0.075 per cent of

GDP; decrease of

public expenditure

by 0.9 per cent of

GDP

GDP -0.2 -0.3 -0.3 0.0

Gross capital

formation -0.3 -0.3 -0.3 0.0

Employment -0.3 -0.3 -0.3 0.0


Total impact

upon primary

balance

1.0 0.9 0.9 0.0



MACROECONOMIC EFFECTS OF FINANCE FOR GROWTH MEASURES

Related legislation Methodological

elements


Measures for innovation: enlargement of the pool

of innovative startup and simplification measures.

D L. no. 3/2015 art. 4 (Investment Compact); tax

credit for R&D, D.L. no. 145/2013 art. 3,

amended by art. 1, subpar. 35-36 L. no.

190/2014 (2015 Stability Law); Patent Box: L. no.

190/2014 (2015 Stability Law) art. 1, subpar. 37-

45 amended by D.L. no. 3/2015 art. 5, subpar. 1

(Investment Compact) and L. no. 208/2015

(2016 Stability Law) art. 1, subpar. 148;

Innovative SMEs D.L. no. 3/2015 (Investment

Compact) art. 4 subpar. 9, 9-bis-12 bis, 12-ter

(fiscal effects).

Incentives for productive investment: Review of

New Sabatini art. 2 of D.L. no. 69/2013; L. no.

190/2014 (2015 Stability Law), art. 1, subpar.

243; D.L. no. 3/2015 art. 8; Guidi Padoan

provision D.L. no. 91/2014 art. 18; ‘Super

amortisation’ L. no. 208/2015 (2016 Stability

Law) art. 1, subpar. 91 -94.

Measures for access to the capital market:

Minibond D.L. no. 83/2012 (Development

Decree) art. 32, subpar. 13 and 26, amended by

art. 36, subpar. 3 D.L no. 179/2012,

(Development Decree bis) and by D.L. no.

145/2013, (‘Destinazione Italia’ Decree) art. 12,

subpar. 2, 5; D.L. no. 91/2014 (‘Crescita e

competitività’ Decree), art. 21; simplification

measures for SMEs going public and introduction

of multiple vote securities and loyalty shares D.L.

no. 91/2014 art. 20; development of Equity

Crowdfunding D.L. no. 3/2015 (Investment

Compact) art. 4 subpar. 10. Measures for credit

liberalisation: direct lending for credit funds,

insurance companies and securitization

companies D.L. no. 91/2014 art. 22, subpar. 2,

letter. b) 3.

Measures concerning system of public guarantee,

FCG, Confidi and Juncker investment platforms:

Central Guarantee Fund for SMEs D.L. no.

3/2015 art. 8, par. 2 bis and art. 8 bis; Platforms

Juncker Reg. (EU) 2015/1017; L. no. 208/2015

(2016 Stability Law) art. 1, par. 822-830.

Incentives to capitalisation of companies: ACE

D.L. no. 201/2011 (‘Salva Italia’ Decree) art. 1,

as amended by art. 1, subpar. 138 L. no.

147/2013 and art. 19 D.L. no. 91 / 2014,

Deductibility of goodwill L. no. 208/2015 (2016

Stability Law) art. 1, subpar. 95 and 96. Measures

to support investment in infrastructure, real

estate and project: revision of the legislation on

project bonds D.L. no. 83/2012 art. 1 and D.L.

no. 133/2014 art. 13; revision of the legislation

on REIT (SIIQ) D.L no. 133/2014 (‘Sblocca Italia’

Decree) art. 20.

Measures to attract investments: international

standard ruling D.L. no. 269/2003 art. 8;

Consulting services for foreign investors provided

by Revenue Agency: Provision of the Revenue

Agency no. 149 505 of 16 December 2013

(envisaged in DL no. 145/2013 (‘Destinazione

Italia’ Decree) art. 10); Courts for companies with

headquarter abroad DL no. 145/2013

(‘Destinazione Italia’ Decree) art. 10; increase of

the threshold to notify the acquisition or disposal

of major holdings DL no. 91/2014, cvt into L. no.

116/2014 art. 20, par. 1, lett. q) and lett. s).


Relevant

features of the

model

used/estimation

technique

Main

macroeconomic

assumptions/

simulation

assumptions

Description

Yearly and cumulated effect on GDP

and other main macroeconomic

variables

2020 2025 2030 LR

DGE Model -

IGEM; European

Commission,

European

Competitiveness

Report, 2014

Increase in the

growth rate of

physical capital by

0.07 per cent in

four years

GDP 0.2 0.4 0.6 1.0

Gross capital

formation 0.6 1.4 2.2 3.3

Employment 0.0 0.0 0.0 0.0


Total impact

upon primary

balance

0.1 0.2 0.3 0.5



MACROECONOMIC EFFECTS FOR REDUCING NONPERFORMING LOANS



D.L. no. 83/2015 (cvt into L. no.

13/2015) “Misure urgenti in

materia fallimentare, civile e

processuale civile e di

organizzazione e funzionamento

dell'amministrazione giudiziaria”;

D.L. no. 18/2016 (cvt into L. no.

49/2016) “Misure urgenti

concernenti la riforma delle

banche di credito cooperativo, la

garanzia sulla cartolarizzazione

delle sofferenze, il regime fiscale

relativo alle procedure di crisi e la

gestione collettiva del risparmio”;

Draft Enabling Law "Delega al

Governo per la riforma organica

delle discipline della crisi di

impresa e dell'insolvenza" (AC

3671/2016)


Relevant features

of the model

used/estimation

technique

Main

macroeconomic

assumptions/

simulation

assumptions

Description



2020 2025 2030 LR

Econometric

model ITEM

Increase of the

share of sold or

securitized

nonperforming

loans from 5% to

30% (over a five

year horizon);

reduction of the

discount that

investors require

for purchasing the

nonperforming

loans from 50% to

30% (over a five

year horizon);

reduction by 10

basis point of the

bank lending rate

up to 2019

GDP 0.2 - - -

Gross capital

formation 0.7 - - -

Employment 0.0 - - -

Consumption 0.2 - - -

Total impact

upon primary

balance

0.1 - - -

Summary of the reform actions for the European Council Recommendations 2015

Appendix C



2015 RECOMMENDATIONS STATE OF PLAY SUB AREA POLICY

CSR 1 - Achieve a fiscal adjustment

of at least 0.25 % of GDP towards

the medium-term budgetary

objective in 2015 and of 0.1 % of

GDP in 2016 by taking the

necessary structural measures in

both 2015 and 2016, taking into

account the allowed deviation for

the implementation of major

structural reforms. […]

The DEF 2016 programmatic scenario foresees a reduction in net

borrowing from 2.3 in 2016 to 1.8 per cent of GDP in 2017 and

then to 0.9 in 2018. In 2019 the balance sheet should be in slight

surplus (0,1 per cent of GDP). On a structural basis, the balance

would improve from -1.2 in 2016 to -1.1 per cent of GDP in 2017

and then to 0.8 in 2018 to 0.2 in 2019. In the planned scenario,

the debt-to-GDP ratio is set to 132.4 per cent in 2016 before

declining in the following years, up to 123.8 per cent.

PUBLIC FINANCE BALANCES

Public Finance and Spending

Review

The hospitals and agencies of the National Health System (NHS)

are required to make public the approved annual budget (within 60

days from the approval) and to set up a transparent monitoring

system focused on the quality of the assistance provided by June

30 of each year.

TRANSPARENCY IN THE

HEALTH SECTOR


Review

The Stability Law for 2015 introduced a reduction in the budget for

Ministries (about €2.3 billion in 2015, €2.5 billion in 2016, €2.6

billion in 2017 and about €2.4 billion in 2018). In addition, within

the central governments some transfers to companies had reduced

and tax credits had rationalized (about €0.4 billion in the period

2015-2018). The transfers for Ferrovie dello Stato have been

reduced by €0.4 billion in 2015.

The Stability Law for 2016 introduced a reduction of expenditure of

the ministries for about €2.7 billion in 2016, €2.1 billion in 2017

and €2.3 billion in 2018. For the Presidency of the Council of

Ministers the reduction amounts to €23 million for 2016; €21.8

million for 2017; €18 million per year from 2018.

SAVINGS IN CENTRAL PA Public Finance and Spending

Review

Completed in April 2016 the projected unification of the five Data

Processing Centers of the MEF Department of General

Administration in a new center located in SOGEI. The unification

hallowed for reduction in IT management costs by 31.2 per cent.

SAVINGS IN CENTRAL PA


Review

The Stability Law for 2016 contains provisions for public national

institutions for social security, to reduce current expenditure

excluding social security benefits, of at least €53 million in the

period 2016-2018, to be achieved also through the strengthening

of the centralized acquisition.

On a temporary basis is also planned an extension of the provisions

already set out for the 2014-2016 period regarding the revision of

the indexation of pension benefits exceeding three times the

minimum, with an expenditure savings, net of the effects tax,

amounting to about €335 million in 2017 and €750 million in

2018.

SAVINGS IN SOCIAL

SECURITY INSTITUTIONS


Review

For the Regions, the Stability Law for 2015 provides cost savings

for €3.5 billion every year in 2015-2017 period and about €4.2

billion in 2018. Regions with special statute and autonomous

provinces contribute for about €550 million per year in the 2015-

2017 period and about €1.2 billion in 2018. Local authorities

contribute for about €4 billion in 2015, €5 billion in 2016 and €6

billion in 2017 and about €7.2 billion in 2018. Net of the

corresponding loosening of the Internal Stability Pact the

contribution of these entities amounted to about €1.2 billion by

2015, €2.2 billion for 2016 and €3.2 billion for 2017 and about

€4.3 billion for 2018.

SAVINGS IN LOCAL

AUTHORITIES


Review

ECONOMIC AND FINANCIAL DOCUMENT - SEC. III THE NATIONAL REFORM PROGRAMME


Cont’d


CSR 1 - Achieve a fiscal

adjustment of at least 0.25% of

GDP towards the medium-term

budgetary objective in 2015 and

of 0.1 % of GDP in 2016 by taking

the necessary structural measures

in both 2015 and 2016, taking

into account the allowed deviation

for the implementation of major

structural reforms. […]

The Stability Law for 2016 foresees a cost-saving of about €1.8

billion in 2016, €1 billion in 2017 and €660 million in 2018 from

the transition of the Regions to the new target balance of public

finance. Moreover no further cuts are legislated for the Regions for

2016, while, however, a new effort by 2017 is requested, through

an additional contribution to the public finances of around €4 billion

for 2017 and €5.5 billion for 2018 (inclusive of savings in expenses

resulting from the use of central purchasing bodies for purchases of

goods and services by the regions, which amounted to €480 million

in each of the years 2017 and 2018) and 2019. For 2019 cuts,

already foreseen for more than €2.2 billion are confirmed. In the

overall context of the spending review measures, the reform of the

accounting of Local Authorities became very important with positive

effects for Italy’s economy intended to consolidate in 2016 and

beyond, through the increasingly careful implementation of the

reform by more than 8,000 local authorities concerned.

With the Memorandum of Understanding of February 11, 2016 in

the Conference of State and Regions the national health needs

have been re-determined and set at €3.5 billion in 2017 and €5

billion as of 2018. The remaining €480 million (relating to the

rationalization of expenditure for purchases and services) will be

allocated by 31 January of each year.

SAVINGS IN LOCAL AUTHORI-

TIES


Review

For the National Health Service (NHS) the government contributes in

2016 for €111 billion with improvement effect, in terms of net

borrowing of about €1.8 billion. Of these funds, an amount of €800

million per year is allocated to the update of the basic levels of

healthcare (LEA), in view of the implementation of the Health Pact

2014-2016.. A National Commission for the annual update of the

basic levels of healthcare and the promotion of appropriateness in

the National Health Service is established.

HEALTH SECTOR


Review

With Stability Law for 2016 the recruitment for the 2016-2018

period is allowed within the expenditure limit of 25 per cent of the

savings coming from the dismissed personnel in the previous year

(net of tax and social contribution effects of €23 million in 2016,

€81 million in 2017 and €164 million in 2018). Added to this is the

limitation and reduction of resources for the accessory economic

treatment of workers in the public sector (€36 million annually).

PUBLIC SERVICE


Review

Further strengthening of the system of purchases, in order to

achieve greater economy and efficiency in procurements by

reducing purchasing unit prices. Each authority, in order to influence

the unit price of purchase should link the levers and tools provided

to affect the unit purchasing price to the rationalization paths

impacting on other items of expenditure, such as the amount

purchased and the reengineering of production processes. The

requested contribution in terms of lower costs in the field of public

procurement is approximately €216 million in 2016 and €697

million in 2017 and €698 million with effect from 2018.

STREAMLINING PURCHASING

OF GOODS AND SERVICES


Review



Cont’d


CSR 1 - […]Ensure that the

spending review is an integral part

of the budgetary process. […]

The Draft Legislative Decree on budgetary reform provides for the

integration of the spending review in the budget cycle, through a

strengthening of the top-down financial programming. After setting

policy objectives in Economic and Financial Document, a Prime

Ministerial Decree assigns to each public administration, specific

expenditure targets by the end of May. On this basis proposals for

the Draft Budget Law and for the Draft Stability Law will be

formulated.

BUDGETARY REFORM


Review

As of 2016, local authorities and regions are required to achieve in

terms of competence a balanced budget - or a balance not negative

- between final revenue and final expenses.

In 2016 the accounting reform of Local Authorities referred to

Lgs.D. no. 118/2011 will be fully operational. The reform

constitutes a milestone in the path of public finances consolidation,

aimed at fostering the coordination of public finances and the

consolidation of public Administration accounts, also for the

compliance with Community rules, the activities related to the

spending review and the determination of needs and standard

costs. The adoption of the new configuration of the accounting

principle related to the enhanced financial competence also

represents an opportunity to update the definition of a balanced

budget, as required in Chapter IV of L. no. 243 of 2012 for Local

Authorities, adapting it to the characteristics of the Lgs.D. no.

118/2011.

LOCAL AUTHORITIES


Review

Strengthened the centralised purchasing of goods and services by

the Public Administration. Centralised public procurement through

CONSIP or other central purchasing body and for purchases below

the European threshold concerned the PA electronic market is made

compulsory for national security and social assistance institutions,

fiscal agencies, and NHS entities.

PURCHASING IN PA


Review

Purchasing tools of CONSIP may also cover maintenance activities.

Municipalities under 10,000 inhabitants can resort to direct award

in case of purchases under €40,000. Central administrations can

negotiate autonomously for purchases above €1,000.

PURCHASING IN PA


Review

The purchase of ICT products by the public administration must go

through CONSIP or other public procurement aggregators including

regional purchasing body. The Agency for Digital Italy has to express

binding opinion on the price-quality criteria of purchasing items.

PURCHASING IN PA


Review

For purchases of goods and services worth more than €1 million,

public administrations must approve a two year financial plan, to be

updated and send to the National Anticorruption Authority

PURCHASING IN PA


Review

A technical Commission for defining standard costs and needs with

respect to local entities (ie the parameters to anchor the financing

of core expenses of municipalities, metropolitan cities and

provinces, in order to ensure a gradual and final overcoming of the

criterion of historical expenditure) will be created at the Ministry of

Economy and Finance.

STANDARD COSTS AND

NEEDS


Review



Cont’d


CSR 1 - […] Swiftly and thoroughly

implement the privatisation

programme and use windfall gains

to make further progress towards

putting the general government

debt ratio on an appropriate

downward path. […]

Privatisation program of Enel, FS, ENAV, Poste Italiane. The targets

set by the Government in the Economic and Financial Document for

2016 as regard expected revenues from privatisation is 0.5 per cent

of GDP in 2016, 2017 and 2018 and 0.3 per cent of GDP for 2019.

Revenues from the privatisation realised in 2015 (i.e. Poste italiane,

special dividend paid by ENAV and disposals of Enel shares) amount

to €5.5billion. In addition €0.5billion came from real estate

dismissal and €1 billion from other reimbursement such as MPS

bonds. Therefore the Government already met its target of 0.4 per

cent of GDP for 2015.

PUBLIC DEBT

State-owned enterprises and

privatisation

Concluded transactions: i) Fincantieri (€1.3 billionn cap., initial

public offering of €350 million); ii) RaiWay (€1.1 billion cap., IPO of

€300 million); iii) 35 per cent of CDP Reti (which owns 30 per cent

of Terna and 30 per cent of SNAM) for €2.1bn; iv) 89 per cent of

TAG for €505 million; v) 5.74 per cent of ENEL already listed, for

€2.2 billion; vi) 35.3 per cent of Poste Italiane (IPO of €3.1 billion

including the greenshoe option).

PUBLIC DEBT


privatisation

Privatisation of other companies directly owned by the State is

ongoing. Rules to divest initial tranches of ENAV (up to 49 per cent)

have been already set. Regarding the privatisation of Ferrovie dello

Stato S.p.A., in November 2015 the government presented a decree

allowing the dismissal of a maximum of 40 per cent of the State

owned shares. The Stability Law 2016 provides a preliminary report

of the government to the Chambers on the privatisation process of

Ferrovie dello Stato. Further transactions are under study.

PUBLIC DEBT


privatisation

The first phase of the buy back of the regional bond for 6 regions

(Campania, Lazio, Liguria, Lombardy, Marche and Apulia) started on

25 November 2015 and closed in December 2015. The transaction

will simplify the financial structure of debt positions of the Regions

and will not involve any increase in the PA debt.

PUBLIC DEBT

Local Authorities

CSR 1 - […] Implement the

enabling law for tax reform by

September 2015, in particular the

revision of tax expenditures and

cadastral values and the

measures to enhance tax

compliance..

For the implementation of the enabling law on reforming the fiscal

system the following measures have been approved: fiscal

simplification and precompiled income tax return, provisions on

taxation of tobacco products ; revision of Cadastral committees;

legal certainty between tax authorities and taxpayers; VAT electronic

invoicing; simplified taxation for international businesses;

simplification of collecting system; monitoring of tax evasion;

sanction system (Lgs. D. no. 158/2015) and litigation procedures;

reorganisation of fiscal agencies.

ENABLING LAW ON

REFORMING THE FISCAL

SYSTEM

Fiscal policy

The Lgs.D. no. 160/2015 on the monitoring and restructuring of tax

erosion and evasion provides for the identification and assessment

of the tax expenditures. The government is in charge of providing an

annual list of tax expenditures according to criteria and methods

that will be supported by an ad hoc external Commission. The list –

to be published together with the Annual budget law – aims at

regularly monitoring and reviewing tax expenditures. In particular,

after 5 years the tax expenditures will be subject to Parliamentary

scrutiny.

On a programmatic view, the same Decree. provides for the

compilation of a further report for the revisions of tax expenditure,

no longer justified or effective, that the government intends to

implement in the fiscal Law.

TAX BENEFITS

Fiscal policy



Cont’d








compliance.

The Lgs.D. no. 160/2015 on the monitoring and restructuring of tax

erosion and evasion provides the submission by the government of

an annual report on the achievements in the field of law

enforcement measures against tax evasion and social security

contributions. In this report the tax gap for all the main taxes will be

estimated and it will be highlighted the recovery of sums due

spontaneous fulfillment of taxpayers together with the income

attributable to the declared and unpaid taxes and correction of

errors in payments.

FOGHT AGAINST TAX EVASION

Taxation

In November 2015 the voluntary cooperation procedure for the

emergence of funds held abroad (voluntary disclosure) was closed

and the estimated revenue is €3.8 billion. 129,565 requests have

been transmitted of which 127,348 concern to the international

disclosure, 1,507 the national, namely the regularization of capital

held in Italy but not declared, while 710 relates to both disclosures.

More than €59.5 billion were revealed to the tax Authorities, 70 per

cent of which (about 41.5 billion) coming from Switzerland.

REGULARISING ASSETS HELD

ABROAD

Taxation

The Lgs.D. no. 128/2015 on legal certainty between tax authorities

and the taxpayer introduced a general standard definition of abuse

of law and tax avoidance and cooperative compliance, and

improvement of cooperation between taxpayers and tax authorities

through instruments as interpellation and mentoring, revised and

expanded.

RELATIONS BETWEEN TAX

AUTHORITIES AND THE

TAXPAYER

Fiscal policy

The Lgs.D. no. 147/2015 strengthened the role of tax authorities in

the internationalisation process of businesses. The constraints to

cross-border operations have been reduced, and introduced

advance arrangements for companies with international activities,

to create greater certainty for investors and increase private

investment.

INTERNATIONALISATION OF

BUSINESSES

Fiscal policy

With the aim of improving the cooperation between tax authorities

and taxpayers, creating a relationship based on dialogue and

mutual cooperation and facilitating the perception of an appropriate

justice system, the Lgs.D. no 156/2015 and no 158/2015 provided

for the revision of the tax dispute and interpellations, and for the

amendment of the sanction system. The legislative decrees state

also that the penalties resulting for the infringement of fiscal rules

are proportionate to the seriousness of behavior.

FISCAL COMPLIANCE

Fiscal policy

Reform of cadastral values. Cadastral Commissions are operational

since January 2015. In the meanwhile, many municipalities have

already updated their cadastral records and apply them to

determine the levels of local taxation. The Stability Law 2016

provides for the revision of the rents of some immovable properties

belonging to the cadastral categories D and E to which most

industrial and productive buildings belong. The new cadastral rents

recomputed after the presentation, by June 15, 2016, of the

updating acts have retroactive effect from January 1, 2016.

CADASTRAL REGISTRY

Fiscal policy

The Stability Law 2016 pursues the reduction of taxation started

with the Stability Law 2015, among which: cuts in the tax wedge on

labour and the complete deduction for IRAP of the total cost for

employees of companies and professionals with permanent

contract.

The Stability Law 2016 provided also for the revision of corporate

taxation (IRES) with the reduction of the tax rate from 27.5 per cent

to 24 per cent from January 1, 2017.

IRAP AND IRES TAXATION

Fiscal policy



Cont’d








compliance.

IRES rate for banks and financial institutes. Starting from January 1,

2017, a 3.5 per cent increase in the IRES rate due by financial and

banking institutes has been introduced. In addition the non-

deductibility of 4 per cent of interest expense of banks and financial

institutes for IRES and IRAP is deleted and remains valid only for

insurance companies.

IRES TAXATION (BANKS)

Fiscal policy

The access to the income flat rate system to be covered by a single

substitute tax at the rate of 15 per cent for individual business

activities has been extended. The rate replaces income tax,

additional regional and municipal taxes, IRAP and VAT.

Professionals and small businesses who have started a new

business in 2015 have a 5 per cent flat-rate tax rate (instead of 15)

for the first five years of economic activity. Moreover, there is a 35

per cent reduction on the due social contribution. Reduction in

social contribution due to INPS by professionals and freelance set

for 2016 at 27 per cent (instead of 28 per cent).

TAXATION (PROFESSIONALS)

Fiscal policy

Increased the amount of allowed deduction from the IRAP taxable

base for small business

TAXATION (SMALL

BUSINESSES)

Fiscal policy

IMU exemption for the so-called ‘bolted’ equipment. TASI reduced

for unsold real estates owned by firms. Extended until December

2016 the tax reliefs for renovation of buildings and energy

upgrading, and for the purchase of furniture.

TAXATION (BUSINESSES)

Fiscal policy

40 per cent increase in the costs deduction for new instrumental

goods purchased or leased between October 15, 2015 and

December 31, 2016 by businesses.

Subsidies through the ‘New Sabatini’ for SME purchasing capital

goods, can also be granted for loans paid by banks and leasing

companies based on a funding different from the CDP plafond.

Reduced the time for granting contributions, and introduced

simplifications of procedures and documentation to be produced for

the disbursement.

Tax credit of 15 per cent for investment in instrumental goods.

TAX BENEFITS FOR

BUSINESSES

Fiscal policy

Firms located in the South (Campania, Apulia, Basilicata, Calabria,

Sicily, Molise, Sardinia and Abruzzi) can benefit from tax credit for

investments in new instrumental goods purchased from January 1,

2016 to December 31, 2019. In particular, the tax credit is as

follows: 20 per cent for small businesses, 15 per cent for medium

businesses, 10 per cent for big businesses. The measure is worth

€2.5 billion and applies also to the agricultural sector

TAX BENEFITS FOR BUSINES-

SES IN THE SOUTH

Fiscal policy



Cont’d








compliance.

New provisions for start-ups and innovative SMEs. The key points

are: i) the possibility for new innovative start-up of an online

registration (currently being implemented); ii) reduction of

administrative costs for the incorporation of new start-up

(implemented); iii) government guarantees, to improve access to

bank finance for innovative start-ups (implemented) and innovative

SMEs (under construction).

INNOVATIVE SME

Simplification and red tape

cost

Exemption from the tax on property (IMU) for agricultural land. IRAP

exemption for agricultural activities and fishing. Revised the tax

rules applied to the agricultural sector (VAT special regime,

registration tax, revaluation of land for agricultural purposes).

TAXATION (AGRICOLTURE)

Fiscal policy

One-year extension for the tax revaluation of unlisted investments

and land owned, as of January 1, 2016, out of business activity. The

rates of withholding taxes are brought to 8 per cent both for

shareholdings and lands. One-year extension for the revaluation of

company assets.

TAXATION (REVALUATION OF

GOODS)

Fiscal policy

Tax exemption for indivisible services for housing owned or leased

intended as principal dwelling

TAXATION (TASI)

Fiscal policy

Revision of the taxation on gambling. Starting from January 1, 2016

increased the rate of the Single Tax (Prelievo Erariale Unico) on

earnings collected through gambling appliances (from 13 to 17.5

per cent of the bet sums; from 5 to 5.5 per cent for video lottery

terminal (VLT) is passed). From the same date, the percentage

earmarked to winnings – the payout – can’t be less than 70 per

cent. It is planned the extension of the deadline for tax

regularisation for emerging of the unauthorized on line bets

agencies.

TAXATION (GAMBLING)

Fiscal policy

The fiscal deduction for donations in favour of cultural investments

is made permanent and set at 65 per cent. Moreover, for 2016 it is

strengthened the tax credit in the movies sector for costs related to

international distribution, replacement of digital projection

equipment, as well as for films made on the national territory

commissioned by foreign productions.

TAXATION (CULTURE)

Fiscal policy

Extended the tax credit already granted to tourist hotel

accommodation, including extraordinary maintenance, conservative

rehabilitation and building renovation involving an increase in cubic

capacity, provided that interventions respect the procedure provided

in the ‘Piano Casa’ Law.

TAXATION (HOTEL)

Fiscal policy

Leasing for principal dwellings is now made more convenient: for

people under 35 years and revenue lower than €55,000 a 19 per

cent tax deduction (for a maximum of €8,000) will be applied in

2016-2020. In case of final purchase, the same 19 per cent tax

deduction is applied (for a maximum of €20,000). For people over

35 year tax benefits are halved (€4,000 and €10,000, respectively).

TAXATION (REAL ESTATE

LEASING)

Fiscal policy



Cont’d








compliance..

An income tax deduction of 20 per cent is introduced on the price of

houses purchased from January 1, 2014 to December 31, 2017

from a construction or renovation firm, with the aim of locating it at

an agreed rent for a minimum of 8 years. The maximum spending

limit is €300,000.

TAX BENEFITS ON UNSOLD

Fiscal policy

From January 1, 2016 citizens can access electronically the data

related to their health care expenses acquired from the health card

system.

SIMPLIFICATION (PRE-FILLED

TAX RETURN)

Fiscal policy

The discipline related to the un-deductibility of blacklist costs is

repealed. Moreover a simplified legislation on income produced by

foreign subsidiaries residents in the same countries has been

introduced, by introducing a new definition whereby the tax regimes

of states or territories are considered privileged when the nominal

level of taxation is lower than 50 per cent of that applicable in Italy.

The obligation of the country by country reporting (OECD) is also

implemented.

SIMPLIFICATION (BLACK LIST)

Fiscal policy

Tax credit of 50 per cent for 2017-2019 period for expenditure

incurred by businesses in 2016 for asbestos remediation of goods

and production facilities.

TAX BENEFITS ON BUSINESSE

(ASBESTOS REMEDIATION)

Fiscal policy

Provisions designed to increase waste recycling. In particular the

differentiated waste collection objectives can be related to the level

of each municipality instead of the optimal geographical area (ATO)

level. An additional charge of 20 per cent has been introduced on

the special levy for the disposal of solid waste in landfills (so-called

‘eco-tax’) to be paid by municipalities not reaching the percentage of

differentiated waste collection. The overcoming of certain levels of

differentiated waste collection triggers reductions in the special

tribute.

DIFFERENTIATED WASTE

COLLECTION

Fiscal policy

CSR 2 - Adopt the planned

national strategic plan for ports

and logistics, particularly to help

promote intermodal transport

through better connections. […]

Approved the National Strategic Plan for Harbour and Logistics, with

the aim of relaunching the competitiveness of the national shipping

network, boosting the transportation of goods and passengers and

easing the intermodal freight transportation. The Plan includes

measures for: simplifying and reducing administrative burdens;

boosting competitiveness and transparency; increasing the

accessibility of land to sea networks; further integrating the logistic

system; improving infrastructures; spurring innovation and

sustainability; ameliorating resources management; promoting

national coordination by reforming the governance of the sector.

NATIONAL STRATEGIC PLAN

FOR HARBOUR AND

LOGISTICS

Transport, Infrastructures and

E-Procurement

Increased the coordination between the Customs and Monopolies

Agencies for the simplification of the import/export procedures in

the port system. The pre-clearing procedures to present custom

declarations on a pre-arrival basis in several Italian ports have been

simplified.

CUSTOMS


cost

For implementing the enabling law on reforming of Public

administration, the government adopted a legislative decree on the

administrative rationalisation of port authorities and their

governance, with the establishment of 15 Port System Authorities

instead of the current 24 Authorities.

SIMPLIFICATION (PORT

AUTHORITIES)

Riforming and modernising

the Public Administration

The National Plan for Airports selected 38 airports of national

strategic interest, essential for exercising the exclusive

competences of the State. Among them, there are 12 airports of

strategic relevance as part of the TransEuropean Networks.

NATIONAL PLAN FOR

AIRPORTS


E-Procurement



Cont’d


CSR 2 - Adopt the planned

national strategic plan for ports

and logistics, particularly to help

promote intermodal transport

through better connections. […]

For projects related to new maritime services for combined freights

transport, aimed at improving intermodal transport and

decongesting the road network resources have been planned

amounting to €45.4 million for 2016, €44.1million for 2017 and

€48.9 million for 2018. For the intermodal system development

contributions for rail transport services have been planned for 20

million per year for the 2016-2018 period. Resources will be

granted under the supervision of the Ministry of Transport.

INTERMODAL TRANSPORT


E-Procurement

For public order €50 million will be allocated for new tools and

equipment, including equipment for personal protection, used in the

security and defense sector. €150 million have been earmarked for

cyber security aimed at strengthening interventions and the

instrumental equipment for cyber and IT national security. Finally,

funded with €15 million the tax credit for citizens installing digital

video surveillance systems or signing contracts with security

companies.

A monthly bonus of €80 for security forces with the exception of port

authorities. Overall, the staff concerned is of approximately 500

thousand units and the expenditure amounts to €500 million for

2016. The contribution is not subject to social security and welfare

contributions, and does not concur to the total income for tax

purpose.

SECURITY PLAN


E-Procurement

CSR 2 - […] Ensure that the

Agency for Territorial Cohesion is

made fully operational so that the

management of EU funds

markedly improves.

The Agency for Territorial Cohesion is becoming fully operational

with the setting up of the Board of Directors at the end of May 2015

and of the Board of Auditors on June, 19.

The Monitoring and Control Unit (Nucleo di Verifica e Controllo -

NUVEC) has been formed and its members appointed. Regulations

for the Organisation and the Accounting were both approved.

Completed the procedures for the assignment of management

positions. Selection procedures for 37 thematic experts have been

activated to boost national and regional projects in the areas

identified by the thematic objectives of the Partnership Agreement

and support the implementation of the 2014-2020 National

Operational Programme.

AGENCY FOR TERRITORIAL

COHESION

EU structural funds

In December 31, 2015 the amount of accountable payments

financed by UE Funds 2007-2013 totaled €42.8 billion,

corresponding to 93.5 per cent of total funding, with an increase of

€16.4 billion (5.9 in 2014 and 10.5 in 2015). At the same date, the

expenditure certified to the European Commission has reached

81.8 per cent of total budget. Results show a strong acceleration in

the implementation, encouraged by actions carried out in recent

months by central and regional administrations with the support of

Agency for Territorial Cohesion, especially for the most delayed

programs. During 2015, under the responsibility and coordination of

the Department for cohesion policies established at the Prime

Minister Cabinet, negotiations have been completed with the EC for

the adoption of 51 operational programs 2014-2020 (ERDF and

ESF), of which 12 national (NOP) and 39 regional (ROP), for

investments of €51.7 billion, including the national co-financing.


COHESION

EU structural funds



Cont’d


CSR 2 - - […] Ensure that the

Agency for Territorial Cohesion is

made fully operational so that the

management of EU funds

markedly improves.

The Governance and Institutional Capacity building National

Operational Programme 2014-2020 started in July 2015. The

Programme supported by Italy and the UE Commission, addresses

the main problems and challenges identified by the Country Specific

Recommendations related to the administrative capacity and

efficiency, the reform of justice system, the better management of

the ESI funds. The Administrative Reinforcement Plan (ARP) was

identified as an experimental tool for strengthening the

administration managing programs financed by the ESI funds. In

March 2016 27 ARP were presented compared to the 29 planned.


COHESION

EU structural funds

To comply with EC guidelines on closing the operational programs of

the 2007-2013 cycle, the Stability Law for 2016 provided for the

assignment of resources, from national co-financing funds assigned

to the 2014-2020 Action Cohesion Plans and the Fund for

Development and Cohesion, for the completion of projects included

in the 2007-2013 European structural funds programming.


COHESION

EU structural funds

Presented in November the Masterplan for the Mezzogiorno of Italy.

The Masterplan includes eight pacts with the Regions and seven

with metropolitan cities and defines the strategic priorities in the

areas of economic development, infrastructure, environment,

culture and tourist attraction through the financial support of

national cohesion funds and the 2014-2020 Structural Funds.

MASTERPLAN FOR THE

MEZZOGIORNO OF ITALY

Regional disparities

CSR 3 - Adopt and implement the

pending laws aimed at improving

the institutional framework and

modernising the Public

Administration. […]

Bill for Constitutional Reform continues the path of approval in the

Parliament: approved, in January 20, 2016 in the Senate, it is set to

conclude its procedure at the Chamber of Deputies in April 2016.

The Bill aimed at overcoming the perfect bicameralism and

modifying the legislative powers’ allocation between State and

regions. At the end of parliamentary procedure it is foreseen a

confirmatory referendum to be held in autumn 2016.

CONSTITUTIONAL REFORM

Institutional reforms

Finally approved the new electoral law for the Chamber of Deputies.

Redrawn also the parliamentary constituencies according to the

new electoral system, each of which is represented by more than

one Member of Parliament.

ELECTORAL LAW

Institutional reforms

Approved in August the enabling law reforming the Public

Administration. In January were preliminarily approved 11 delegated

legislative decrees implementing the enabling law. In particular:

digital citizen ship and Code of Digital Administration; reorganisation

of Services’ Conference; simplification and transparency:

simplification and speeding up of administrative procedures;

regulation of Segnalazione Certificata di Inizio Attività; revision and

simplification of regulation on corruption and transparency;

rationalisation of ports’ authorities; reorganisation of state forestry

and police corps; health Directors; dismissals; State-owned

enterprises; unified law on local public services. In January is ha

been also approved the legislative decree amending and repealing

legal provisions providing for the adoption of non-legislative

measures for their implementation.

ENABLING LAW REFORMING

THE PUBLIC ADMINISTRATION



Approved the law in the field of corruption, against patronage and

vote buying, accounting fraud and money laundering. False

accounting becomes punishable for all companies, not only for

those listed and abolished thresholds for punishment exemption.

Penalties for crimes against the PA are tightened. For those

collaborating with the justice system there is a reduction of penalty.

FALSE ACCOUNTING

Criminal justice and

corruption



Cont’d


CSR 3 - Adopt and implement the

pending laws aimed at improving

the institutional framework and

modernising the Public

Administration. […]

The assessment of staffing across public administrations has been

completed. Personnel equalization tables have been approved,

according to the various legal systems of professions existing in the

public sector, with the aim of facilitating the internal mobility

process. The staff previously working in provinces will be relocated

to regions and local authorities (provincial police and employment

services personnel). A 60 million fund has been established for

salaries of surplus staff of the provinces. An extraordinary

commissioner will be appointed for carrying out the transfer of

surplus staff by June 30, 2016.

MOBILITY IN PUBLIC

ADMINISTRATION



An electronic card with a maximum amount of €500 has been

issued for the year 2016, for all Italian citizens or citizens of other

EU Member State living in the country, who are eighteen in 2016.

The card can be used for theatrical and cinematographic

representations, for the purchase of books and access to museums,

exhibitions and cultural events, monuments, galleries,

archaeological sites, natural parks and live entertainment.

CARD FOR STUDENTS

Culture

Changes are planned to the Military Order Code in the field of

organization and personnel, in order to achieve the objectives of

reorganisation and reduction of the national military instrument

through adjusting and integrating provisions to the Lgs.D of 28

January 2014, no. 7 and 8, (on the basis of Delegation Law of 31

December 2012, no. 244).

CHANGES TO THE

PERSONNEL IN THE MILITARY

ORDER

Reforming and modernising


Appointed a Commissioner for the National Administration School,

which will draft a plan for the reduction of at least 10 per cent of

state funding required for the operation of the school. As for the

Formez the Commissioner will launch a plan to reduce by at least 20

per cent the expenditure compared to 2015.

SAVINGS IN NATIONAL

ADMINISTRATION SCHOOL



The reorganisation of the Ministry of Heritage and Cultural Activities,

Tourism and Museums, is being implemented. It provides a

significant organisational change of state museum system and a

strong investment on the valorisation of museum with the creation

of 20 individual museums and a network of 17 regional Poles that

will facilitate the ongoing dialogue between the different public and

private museums of the territory, to encourage an integrated offer to

the public. In museums with special autonomy the direction has

been entrusted through an international call.

CULTURAL ACTIVITIES AND

MUSEUMS



In agriculture, adopted measures to improve the efficiency of the

PA. In particular, it is under way the reorganisation of the companies

and agencies under surveillance of the Ministry. Simplifications in

the management of the CAP 2015-2020 have been introduced.

AGRICULTURE



CSR 3 - […]Revise the statute of

limitations by mid-2015. […]

The legislative Decree (Atto Senato no 1844) containing

amendments to the Criminal Code concerning the statute of

limitations and authorizing the government to review rules

reparation for breach of reasonable process was presented on

February 2014, then approved by the Chamber of Deputies on

March 2015 and sent to the Senate. In October the competent

Commission of the Senate started to discuss the bill.

STATUTE OF LIMITATIONS


corruption

On September 2015 presented to the Parliament the law containing

amendments to the Criminal Code and to the Criminal Procedure

Code to strengthen the rights of defense and ensure a reasonable

duration of the trial and granting the rehabilitative effect of a

sentencing (Atto Camera no. 2798). The provision was immediately

approved by the Chamber of Deputies and sent to the Senate.

AMENDMENTS TO THE

CRIMINAL CODE


corruption



Cont’d


CSR 3 - Ensure that the reforms

adopted to improve the efficiency

of civil justice help reduce the

length of proceedings. […]

The performance analysis of civil justice shows a steady

improvement. In January 2015, total outstanding backlog in all

degrees of judgment went down to less than 4.5 million from nearly

6 million pending in late 2009. The seniority of civil cases and

analysis of the performance of the courts in the last year shows

some improvement both for seniority in lying causes (-14 per cent of

contentious ultratriennial causes compared to 2014) and national

average duration (-5 per cent). Even the Courts of Appeal show the

first improvements in efficiency in terms of backlog reduction (-8.2

per cent). In 2015, 20 per cent fewer new civil cases were

registered and also registrations in the Court of Appeal went down

by 10 per cent.

CIVIL JUSTICE PERFORMANCE

Civil justice and transparency

Penal justice reform (Atto Camera no. 2798) was presented in order

to handle judicial backlog, revise the criminal codes and

proceedings while strengthening the rights of defense and ensuring

a reasonable duration of trials. The bill delegates the government to

reform the criminal process and the penitentiary system. In addition,

a specific reform has the purpose of revising the statute of limitation

(Atto Senato no. 1844). The legislative process is ongoing.

PENAL JUSTICE REFORM


corruption

In January 2016 two legislative decrees have been approved by the

Parliament to reduce the use of criminal law through the

depenalization of some minor crimes, transform some minor crimes

into administrative offenses and make sanctions more incisive while

ensuring a more effective repression of the most serious crimes.

DEPENALIZATION


corruption

The transposition into national law of Council Framework Decision

2009/948/JHA on prevention and settlement of conflicts for the

exercise of jurisdiction in criminal proceedings is ongoing.

PREVENTION AND

SETTLEMENT OF CONFLICTS


corruption

The Committee for the fight against fraud towards the European

Union (COLAF) is operational, responsible for the elaboration and

development of the national strategy on combating

irregularities/fraud to the detriment of the European Union's budget.

Thanks to the Committee, in 2015, the number of cases of

irregularity/fraud on account decreased of about 20 per cent, more

than 90 cases of fraud have been completed and further losses

were avoided for a total amount of over €16 million.

COMMITTEE FOR THE FIGHT

AGAINST FRAUD (COLAF)

Justice sector

The Stability Law 2016 provides for the fiscal incentives to extra

judiciary negotiation to be permanent: the costs of negotiation can

be deducted on a regular basis.

EXTRA JUDICIARY

NEGOTIATION

CiviL justice and transparency

Invitalia assisted the Ministry of Justice to develop the Telematic

Notification System (SNT), finally set up. The system allows the

courts to be fully in line with the law, to speed up the internal

procedures as well as to reduce the amount of papers required.

TELEMATIC NOTIFICATION

SYSTEM

Justice



Cont’d


CSR 3 - Ensure that the reforms

adopted to improve the efficiency

of civil justice help reduce the

length of proceedings. […]

In 2015 the number of tax mediation process has increased to

115,000 of which 61,000 resolved without establishing a judgment.

Thanks to this institution, in 2015 first instance appeals marked a

total reduction of 28 per cent with respect to 2011 (the year before

the introduction of the tax mediation process). Particularly those

conducted against the Revenue Agency had a reduction of 45 per

cent in the same period. To further deflate tax dispute in 2016 it is

provided the extension of the institute of mediation to all the tax

authorities. In 2015, compared to 2014, there was a further

reduction of appeals in Provincial Tax Commission (-2.4 per cent)

confirming the trend of recent years: the reduction compared to

2011 (the last year before the introduction of the institute of

mediation) is 47.5 per cent.

TAX JUSTICE PERFORMANCE

Tax justice

The use of CES (Certified Electronic Signature) in the procedural

communications anticipated the full implementation of the digital

tax trial, with clear and direct benefits for both the administrative

staff working in Tax Commissions and the parties involved in the tax

judgment. For the digital tax trial as at December 1, 2015 the

experimental phase started in the local and regional Tax

Commissions of Tuscany and Umbria. It is foreseen a gradually

extension to all regions.

TAX TRIAL

PA Tax Justice

To rationalise the costs resulting from the violation of the

reasonable time of the trial, in Chapter II of L. no. 89/2001 (so-

called Pinto Law) a number of preventive remedies are introduced

before submitting an application for compensation.

REASONABLE DURATION OF

THE TRIAL

Civil justice and transparency

CSR 4 - By end-2015, introduce

binding measures to tackle

remaining weaknesses in the

corporate governance of banks,

implement the agreed reform of

foundations […]

In April 2015 a protocol between ACRI and MEF was signed, in order

to reform the regulation of Banking Foundations. It responds to the

need that Banking Foundations be the main stakeholder while

respecting the autonomy of participated banks, as well as

diversifying their investment. The key points of the agreement are: i)

maximum investment in one bank cannot exceed 1/3 of its assets;

ii) indebtedness must be only temporary, not exceeding 10 per cent

of the net asset; iii) management board and supervisors are

appointed for 4 years and renewable only once; iv) after the first

mandate, a 3 years period of interval is needed before a new

appointment.

BANKING FOUNDATIONS

Financial services and bank

system

The secondary legislation required to implement the reform of

cooperative banks (D.L. no. 3/2015) has been adopted. Since the

legislation enters into force, the cooperative banks owning assets

higher than €8 billion have 18-month to modify their status into a

limited company.

COOPERATIVE BANKS


system

Lgs.D. no.72/2015 has been approved. It implements the Directive

2013/36/UE and reforms the regulation on managers and

shareholders. Bank of Italy supervisory powers have been enlarged,

adding the possibility of removing one or more members of the

board and managers of the bank. The administrative sanctions have

been totally reviewed, by adopting a system in which the company is

sanctioned the first.

BANKING SUPERVISION


system

The D.L. no. 18/2016, containing measures for the reform of

cooperative banks (BCC) imposes an obligation on the BCC to join a

cooperative banking group that has a leader company with assets of

no less than €1 billion.

COOPERATIVE BANKS


system



Cont’d


CSR 4 - By end-2015, introduce

binding measures to tackle

remaining weaknesses in the

corporate governance of banks,

implement the agreed reform of

foundations […]

Possibility of accessing the guarantee fund also for firms supplying

strategic business establishments. 20 percent of the resources of

the guarantee fund for SMEs is allocated to firms in Abruzzo,

Basilicata, Calabria, Campania, Molise, Apulia, Sicily and Sardinia

regions.

GUARANTEE FUND FOR

BUSINESSES


system

CSR 4 - […], and take measures to

accelerate the broad-based

reduction of non-performing loans.

With the L. no. 132/2015 (D.L. no. 83/2015), the government

amended the deductibility for IRES and IRAP purposes of write-

downs and credit losses for credit and financial institutions and

insurance companies by introducing, in place of the annual

deducibility at the rate of one-fifth for each year, the full deductibility

of such negative income in the year they are recognized in the

financial statements.

DEDUCTIBILITY OF WRITE-

DOWNS AND CREDIT LOSSES

FOR CREDIT

Fiscal policy

The Law no. 132/2015 (D.L. no. 83/2015) has introduced more

competition in the proceeding of composition with creditors, as well

as speeding up the recovery of bad loans. In particular it has

encouraged a fast and effective creditor satisfaction, increasing the

amount creditors can recover and the value of impaired loans

through easier access to financing for companies in financial

distress; the possibility for third parties to make alternative offers to

purchase assets; the possibility for creditors to put forward a

composition plan; new cram down provisions in connection with

restructuring agreements with financial creditors.

INSOLVENCY PROCEDURE


system

Enabling Law reforming the insolvency regime, on the basis of the

legislative proposal made by the Rordorf Commission at the end of

2015.

INSOLVENCY


system

To encourage the development of non-performing loans market, the

D.L. no. 18/2016 contains provisions which allow starting the

guarantee scheme on liabilities issued as part of securitization

operations, realized on the sale by Italian banks of monetary loans

portfolios qualified as bad debts.

NPL GUARANTEE


system

As of January 1, 2016 Italy applies the single rulebook for the

resolution of banks and large investment firms, as prescribed by the

Bank Recovery and Resolution Directive. Finally, it has been

transposed the directive on deposit guarantee, for greater

harmonization of the deposit insurance scheme up to €100,000.

BAIL IN


system

Established a solidarity fund with resources for €120 million, for the

investors that at the date of entry into force of D.L. no. 183/2015,

held subordinated securities issued by the four banks involved in

the rescue.

SOLIDARITY FUND FOR BANKS


system



Cont’d


CSR 4 - […], and take measures to

accelerate the broad-based

reduction of non-performing loans.

With D.L. no. 183/2015, merged in the Stability Law for 2016, the

government and the Bank of Italy solved the crisis of 4 banks in

extraordinary administration: Banca Marche, Banca Popolare

dell’Etruria e del Lazio, Cassa di Risparmio di Ferrara, Cassa di

Risparmio di Chieti. For each of the four banks, the 'good' part of the

budget was separate from the 'bad' one. With regard to the 'good'

part (deposits, current accounts and bonds), with effect from 23

November 2015, four joint stock companies were established,

performing ‘bridge bank’ activities, with the aim to maintain the

continuity of essential functions previously performed by the same

banks. The capital was reconstituted to about 9 per cent of total

assets (risk weighted) by the National Interbank Resolution Fund.

Administrators, appointed by the Bank of Italy have the commitment

to sell the good bank within a short time to the best tenderer, with

transparent procedures and market, then go back the proceeds

from the sale to the Resolution Fund. A single 'bad bank' has been

established (a banking license-free), that merged all the bad loans

of the four banks, devalued to €1.5 billion of the original €8.5

billion, which will be sold to specialists in debt collection or run

directly to retrieve them. The original banks incorporate all losses

and their coverage and were immediately placed into compulsory

liquidation.

PROVISIONS FOR CRISIS OF

BANKS (‘SALVA BANCHE’)


system

CSR 5 - Adopt the legislative

decrees on the design and use of

wage supplementation schemes,

the revision of contractual

arrangements […]

Progress in the implementation of the enabling law reforming the

labour market. Approved the following measures: the standard

open-ended contract with increasing protection according to tenure;

the universal unemployment benefit scheme associated to stronger

active labour market measures; work-life balance measures;

simplification of contractual models and administrative procedures;

reorganisation of the active labour market policy; simplification of

inspection activity and creation of a National Inspectorate.

Preliminary approval of the Draft Law extending the Jobs Act to self-

employed workers and promotes a more flexible employment to

promote the conciliation of life and work

JOBS ACT

Employment protection

legislation & framework for

labour contracts

The Stability Law 2015 introduced a permanent personal income

tax bonus of €80 for employees with an annual income less than

€26,000; the total exemption from the payment of social-welfare

contributions due on the new full-time open-ended contracts signed

until December 2015. Extended for 2016 the fiscal incentives on

new open-ended contracts, lowering their amount (40 per cent of

exemption) and duration (2 years) and for a maximum amount of

€3,250. For south regions fiscal incentives are extended to 2017.

FISCAL BENEFITS FOR

PERMANENT WORKERS


legislation & framework for

labour contracts



Cont’d


CSR 5 - Adopt the legislative

decrees on the design and use of

wage supplementation schemes,

the revision of contractual

arrangements […]

Adoption and entry into force of the Lgs.D. no.148/2015 which

extends the scope of the existing wage supplementation schemes

(WSS) by including also apprentices and businesses with more than

5 employees. Streamlined the administrative rules to access the

scheme and abolished some consultation procedures with trade-

unions. A total maximum duration was fixed for each firm (24

months in 5 years for the ordinary WSS and 36 for extraordinary

one). WSSs will not be used in case of business closure.

Beneficiaries with a reduction of working time higher than 50 per

cent must sign a personalised agreement to access ALMPs.

WAGE SUPPLEMENTATION

SCHEMES (WSS)

Social safety nets

Social safety nets. Increased by €250 million the Social Fund for

Employment and training for 2016 for refinancing social safety nets

on derogation. As from January 1, 2016 and until December 31,

2016, the wage supplementation schemes (WSS) on derogation will

not be granted or renewed for a period exceeding three months per

year. The mobility allowance on derogation will not be granted to

workers that at the date of its concession have already benefited

from the allowance for at least three years, even if not continuously.

For the remaining workers the maximum time of facilitations will

instead be reduced from six to four months (not further extendable).

For workers in the South of Italy the facilitations are extended for

further two months. The maximum limit of use remains set at three

years and four months. The unemployment allowance for workers

with coordinated and continuous collaboration (DIS-COLL),

introduced by Lgs.D. no. 22/2015, is attributed in 2016 up to an

amount of €54 million and in 2017 up to €24 million, and it may be

increased.

SOCIAL SAFETY NETS

CSR 5 - […] work-life balance and

the strengthening of active labour

market policies. […]

Implementation of Youth Guarantee. On 31 December 2015 the

first phase of the ‘Youth Guarantee Programme’ was concluded.

With the second phase the programme includes two new measures:

the Superbonus to process apprenticeships and is provided for

scheduled for employers hiring with permanent contract person

between 16 and 29 years and Selfiemployment. a revolving fund for

access to subsidised loans to support self-employment initiatives.

YOUTH GUARANTEE

Active labour market policies

School-job transition compulsory for all students of the last three

years of secondary school. From January 2016 allocated €100

million per year and signed a Memorandum of Understanding

between the Ministry of Education and Confindustria to develop

skills and abilities to be used professionally in the labour market.

Revision of the apprenticeship discipline: as required for the

implementation of the Lgs.D. no. 81/2015, training standards and

general criteria for the realisation of apprenticeship have been

defined.

SCHOOL-JOB TRANSITION




Cont’d


CSR 5 - […] work-life balance and

the strengthening of active labour

market policies. […]

Adoption of the enabling law reforming the active labour market

policies. Definition of the strategy implementing the new active

labour market policies and agreements with the Regions necessary

under the current Constitutional framework (November 2015-

Jannuary 2016). Implementation of the active labour market

policies strategy according to the regional agreements and issuance

of activation vouchers to unemployed individuals (February 2016).

ENABLING LAW REFORMING

THE ACTIVE LABOUR MARKET

POLICIES


In November the government appointed the president of the

National Employment Agency and the president of the National

Agency for Safety and Health at Work.

Employment protection legis-

lation & framework for labour

contracts

The Lgs.D. no. 80/2015 introduced work-life balance measures to

increase the flexibility in parental leave, which is now extended to all

types of workers. The parental leave can be used until the child age

of 12 (vs. 8 in the previous legislation). Until the child is 6 years

(previously 3) the parental leave is partially remunerated (30 per

cent of the regular wage). In case of adoption, parents are entitled

with the same rights as natural parents. The same decree contains

measures to strengthen the telecommuting and distance work

opportunities. The Stability Law 2016 rises to two the compulsory

days of parental leave for fathers. ‘Baby sitter Voucher’ is extended

on experimental basis to 2016 and will include also self-employed

women.

WORK-LIFE BALANCE

Wage and wage-setting

Part time. Possibility for all private sector employees with

permanent contracts maturing pension requirements by 2018 to

reduce working hours. The reduction in working hours must be

between 40 and 60 per cent and may not exceed the maturity term

of the right to a retirement pension.

PART TIME



contracts

Tax benefits are foreseen, consisting in the full deductibility: i) within

the annual limit of €5 thousand, for expenses incurred in the

personalised services of certification of skills, orientation, research

and supporting self-employment initiatives, aimed at integrating or

reintegrating the self-employed in the labor market; ii) within an

annual limit of €10,000, of costs for participation in conferences,

congresses and training courses and professional training, and of

costs for charges sustained for the guarantee against non-payment

of self-employment services provided by insurance forms or

solidarity. Planned an office dedicated to self-employment in the

employment centers and other center accredited to offer

employment services and active policies. The self-employed will be

equalized to small entrepreneurs, for accessing NOP and ROP funds

to be worth on the European Structural Funds. Extended also to self-

employed workers the period of maternity allowance and the

duration and period of time within which these workers can take

advantage of parental leave.

JOBS ACT FOR SELF-

EMPLOYED



contracts

Planned the suspension, without right to the compensation, of the

self-employed performing their activity for a continuous period, in

the event of pregnancy, illness and injury, for a period not exceeding

150 days per calendar year, and the suspension of the payment of

social security contributions and insurance premiums for the

duration of the disease and the injury up to a maximum of 2 years,

in case of illness and injury sufficiently serious to impede the

carrying out of work for more than 60 days.

WORK-LIFE BALANCE




Cont’d


CSR 5 […] Promote, in

consultation with the social

partners and in accordance with

national practices, an effective

framework for second-level

contractual bargaining. […]

Employee performance that can be performed in part within the

business premises and partially outside (within the only limits of

maximum duration of daily and weekly working hours, resulting from

the law and collective bargaining) aimed to increase productivity,

while facilitating the conciliation of life and work.

PROVISIONS FOR ‘LAVORO

AGILE’



contracts

Favourable tax treatment for productivity wages in the private

sector. Employees with an annual gross income of maximum

€50,000 are subject to a facilitated personal income tax regime (i.e.

10 per cent) on the salary linked to productivity within fixed limits

(€2,000). The amount is greater in case the worker is directly

involved in the business organisation (€2,500). In addition,

transfers or services provided by the corporate welfare to the

employee or to family members (including elderly and non-sufficient

people) will not be subject to the IRPEF tax.

MEASURES FOR

PRODUCTIVITY WAGES


Foreseen a decree by the Ministry of Labour in consultation with the

Ministry of Economy setting criteria for measuring improvements of

workers in terms of productivity, quality, efficiency and innovation.

The decree will set also the rules for the implementation of new

favourable tax regime, also with reference to the forms of joint

organisation, and the monitoring of sectorial or second level

contractual bargaining.

MEASURES FOR PRODUCTIVI-

TY WAGES


CSR 5 - […] As part of efforts to

tackle youth unemployment, adopt

and implement the planned

school reform and expand

vocationally-oriented tertiary

education.

Approval of the 'La buona scuola' reform: greater autonomy in

school governance and planning; increased tenured teaching staff

thanks to an extraordinary recruiting plan; developed teachers’

competencies through permanent learning; new evaluation system

for teachers with careers linked to performances.

THE ‘BUONA SCUOLA’

REFORM

Education

The first self-evaluation report by schools has been produced.

Strengthened the National Agency for the Evaluation of the

University and Research Systems (ANVUR).

ANVUR

Education

More resources to the school system; fiscal incentives to taxpayers

with the ‘school bonus’ (tax credit of 65 per cent in 2016 and 2017

and of 50 per cent in 2018 for donations from private to schools).

School building interventions for architectural and technological

enhancement and for improving the energy efficiency.

SCHOOL BONUS

Education

Modified the procedure for the recruitment of school administrators:

the selective training-competition is planned to be organized by the

Ministry of Education (according to MEF) and the call has to contain

all vacancies in the three-year period. During the selection it will be

possible to admit a number of candidates higher than the available

places, up to a limit of 20 per cent.

RECRUITMENT OF SCHOOL

ADMINISTRATORS

Education

Allocated €45 million for the activation of new territorial laboratories

for employability foreseen by ‘La buona scuola’ reform. This will

allow students to have orientating instruments to work and to self-

employment.

TERRITORIAL LABORATORIES

FOR EMPLOYABILITY

Education

Allocated resources for the National Plan for Digital School

envisaged by ‘La buona scuola’ reform. Resources amount to €1

billion, of which €600 million for infrastructure and €400 for

implementation of new skills, staff training, monitoring and

accompanying measures. The Plan includes 35 actions.

NATIONAL PLAN FOR DIGITAL

SCHOOL

Education



Cont’d


CSR 6 - Implement the

simplification agenda for 2015-17

to ease the administrative and

regulatory burden. […]

The monitoring of the state of implementation of the Simplification

Agenda is ongoing. As of March 15, 2015, 90 per cent of deadlines

of the Agenda were met, with detailed programming.

SIMPLIFICATION AGENDA


cost

The implementation of Agenda has obtained the first results: the

survey work and investigation (survey OSS and ITS) carried out with

the collaboration of business associations, has helped to identify

the obstacles to be removed and the most suitable simplification

solutions already adopted in the framework of the implementation

of the enabling law on reform of PA; simplified models for the

construction sector; forms simplification for the business activities;

full adoption of the pre-filled tax return for permanent employees

and pensioners; activation of a tax tutoring reservation service and

strengthening of e-channel for tax assistance. Digitalisation of the

social security compliance certificate (DURC). By March 15, 2016

the Public System of digital identity (Sistema Pubblico di identità

digitale – SPID) is operational.

SIMPLIFICATION AGENDA


cost

Simplification measures included in the implementation of the

enabling law on the reform of PA : cut in the time of the Services’

Conference; mutual recognition, simplification and standardization

of procedures; the Segnalazione Certificata di Inizio Attività – SCIA

and simplification of forms.

SIMPLIFICATION FOR PUBLIC

ADMINISTRATION


cost

Further simplifications on corporate structure for SMEs and the

incorporation of simplified limited liability companies are part of the

Annual Competition Law.

INNOVATIVE SME


cost

CSR 6 - […] Adopt competition-

enhancing measures in all the

sectors covered by the

competition law, and take decisive

action to remove remaining

barriers. […]

The Annual Competition Law (ACL) was approved by the Chamber of

Deputies on April, 2015. The ACL covers the following sectors:

insurance, telecommunications, postal services, electricity, natural

gas, motor-fuel, retail markets, professional services, pharmacies.

The ACL is currently under discussion before the Senate’s Industry

Committee.

ANNUAL COMPETITION LAW

Competition in services;

Telecom, postal services &

local public services; energy

sector

CSR 6 - […] Ensure that local

public services contracts not

complying with the requirements

on in-house awards are rectified

by no later than end-2015.

The Enabling Law no. 11/2016 delegates government to the

transposition of the European Directives reviewing public

procurement procedures. The bill entrusts the government to take

actions in order to harmonise the domestic legislation to the

European criteria on: i) awarding concession contracts

(2014/23/EU); ii) public procurement (2014/24/EU); and iii)

procurement by entities operating in the water, energy, transport

and postal services sectors (2014/25/EU). The transposition into

national legislation has to be done within April 2016. The central

role of guidance and supervision is assigned to ANAC.

PUBLIC PROCUREMENT

PROCEDURES AND

CONCESSIONS


E-Procurement

Summary of the reform actions for the EU2020 targets

Appendix D



EU2020 TARGET STATE OF PLAY SUB AREA

POLICY

1-Employment target

[67-69%]

Businesses and professionals can completely deduct from the IRAP tax base the

cost of permanent employees.

DEDUCTION FROM IRAP

Fiscal Policy

Three years social security exemption (de-contribution) for newly hired

permanent workers. For new permanent work contracts, signed between January

1, 2015 and December 31, 2015, employers are exempt from the payment of

social security contributions (with the exception of premiums and contributions

due to the INAIL), up to an exemption cap of 8,060 euro per year. The Stability

Law for 2016 extends the tax incentives on new permanent contracts to the

entire 2016, setting at 40 per cent the rate of exemption for a maximum period

of 2 years and a maximum amount of 3,250 euro per year. For firms located in

the Abruzzo, Molise, Campania, Basilicata, Sicily, Apulia, Calabria and Sardinia,

the de-contribution is extended to 2017. This measure is conditioned to the EU

approval and to the availability of resources from the Cohesion Fund.

FISCAL INCENTIVES

FOR NEW HIRINGS

Fiscal Policy

70 per cent deductibility of labour cost from the IRAP, for seasonal workers

employed for at least 120 days/ fiscal year. The deductibility operates from the

second contract signed with the same employer in a two-year period starting

from the end of the previous contract.

DEDUCTIBILITY OF

LABOUR COST

Fiscal Policy

Implementation of the enabling law on labour market reform: Lgs.D. no.

23/2015 for the permanent contract with increasing level of protection. In case

of dismissal, the compensation is related to tenure with costs defined by law.

The new discipline fixes the indemnity for the different case of dismissals

brought before the court. Moreover, a procedure for out-of-court conciliation has

been defined.

JOBS ACT


and contractual

framework


150/2015 for labour services and active policies, as well as the creation of the

National Agency for Employment. Creation of the employee’s electronic folder. An

activation voucher (to be spent in labour activation initiatives and training

offered by authorized employment services centres) is provided for people

unemployed for more than 4 months and who benefit from NASpI.

JOBS ACT

Active labour market

policies


22/2015 for the introduction of new unemployment benefit for the involuntary

unemployment, called New social insurance for the employment (NASpI). The

unemployment benefit for temporary workers (DIS-COLL) has been extended

throughout 2016 and 2017 within the limit of 54 million for 2016 and 24 million

for 2017 (2016 Stability law).

JOBS ACT

Unemployment benefit

As at December 31, 2015, the first phase of Youth Guarantee Programme has

been concluded. As at April 1, 2016, a number of 1,016 young people were

registered to the programme, with an 11.2 per cent increase compared to

December 31, 2015. The incidence of both the enrolled and the initiatives

proposed by the competent services on the total number of young people

registered has also increased. As of present, 75 per cent of registered (net from

the cancelled ones), has been enrolled, while to the 35 per cent of young people

at least one initiative has been proposed. With the second phase the Programme

has been enriched with two new initiatives: 1) the ‘Superbonus’ to transform

apprenticeships, provided for the employers who hire with permanent contract a

person aged 16-29 years old; 2) ‘selfiemployment’, a rotation Fund with an initial

endowment of €124 million to have access to favoured credit for whom start

self-employment and self-entrepreneurship. With ‘selfiemployment’ new

entrepreneurs will get a loan at zero interest rate up to €50,000 for a maximum

duration of 7 years.

YOUTH GUARANTEE


policies



Cont’d


POLICY

1-Employment

[67-69%]

The following expenditures are totally deductible from the taxable base: i) within

the yearly threshold of €5,000, the expenditures for service of competence

certification, orientation, research and support of entrepreneurship, finalised to

inclusion or re-inclusion of the self-employed in the labour market. ii) within the

yearly threshold of €10,000, the expenditures to participate to conferences,

congresses, training classes and vocational education, as well as the costs

related to the insurance against the non-payment of self-employment.

Employment services centres and authorised centres for ALMPs must open a

dedicated desk for self-employed. The self-employed workers will be considered

as small entrepreneurs, so as to access NOP and ROP on Structural EU Funds.

Self-employed workers can now have access to maternity indemnity and leave as

well as benefit from parental leaves.

The collaboration is suspended without compensation for the self-employed who

work for the same employer in case of pregnancy, illness and injury, for a period

up to 150 days/year. Social security contributions and insurance premium are

also suspended for up to 2 years, in case of severe illness and injury that impede

to work for more than 60 days.

JOBS ACT FOR SELF-

EMPLOYED


and contractual

framework

A dependent work can be executed partially in the firm’s location and outside the

firm’s (within the limit of maximum duration of day and week hours, according to

the law and collective bargaining). The provision is aimed to raise productivity, by

also facilitating the work/life balance.

FLEXIBLE WORK


and contractual

framework

Annual monitoring (instead of triennial) of requirements for nursery schools

service. Support to local governments to realise new facilities for nursery schools

and increase either number of employees or hours worked.

NURSERY SCHOOLS


and contractual

framework

‘Baby sitter Voucher’ is extended in experimental phase to independent female

workers, with a spending cap of €2 million (2016 Stability Law).

VOUCHER BABYSITTER

Wages and wage

bargaining

2 - R&D

[1,53% of GDP]

New regulations governing the tax credit for businesses investing in R&D (2015

Stability Law). Extended the range of beneficiaries to all types of businesses,

regardless of their legal form, economic sector or accounting regime adopted. The

length of the benefit has been extended to five years (2015-2019). The tax credit

is recognized to those firms investing in R&D, up to a maximum of €5 million per

year. The credit amounts to 25 per cent of the annual increase in amortisation

quota of instruments and laboratory equipment and technical competences as

well as industrial monopoly. The rate is raised to 50 per cent for the increase of

expenditures related to highly qualified personnel.

INCENTIVES FOR R&D

INVESTMENTS

Fiscal Policy

SUPERAMORTISATION. The cost to be amortised and the financial rent can be

increased by 40 per cent.

CHANGES TO ‘NEW SABATINI’ REGULATION. The contributions in favour of SMEs

who buy instrumental goods, with loans by banks and leasing companies, can

also be obtained through a different funding from the CDP’s one.

15 per cent tax credit for firms’ investments in instrumental goods.

INCENTIVES FOR FIRMS

Fiscal Policy

Defined a new category of innovative SMEs to benefit from tax incentives (D.L. no.

3/2015): businesses with fewer than 250 workers, with annual turnover less

than €50 million based on specific characteristics related to the ability of

introducing product and/or process innovations. Benefits: exemption from the

ordinary company discipline; support in the settlement of losses; reduction of

some administrative burdens; simplified State guarantee for bank loans; tax

incentives to invest in innovative SMEs; support for internationalisation activities.

INNOVATIVE SMEs

Fiscal Policy



Cont’d


POLICY

2 - R&D

[1,53% of GDP]

New discipline for start-up and innovative SMEs. Key points are: i) possibilities

for new innovative start-up to register on line (in implementation); ii) reduction of

administrative costs to incorporate new start-up (implemented); iii) State

guarantees aimed to improve access to banks’ financing for innovative start-ups

(implemented) and innovative SMEs (in implementation).

INNOVATIVE SMEs

Simplification and

reduction of

administrative burdens

19 per cent of deduction from taxable income for persons who invest in

innovative start-ups, for provisions up to €500,000. 20 per cent of deduction

from taxable income for companies who invest an amount up to €1.8 million.

Rates increase to 25 per cent and 27 per cent, respectively, if the sum is

invested in a start-up with social vocation or in firms who develop and sell

innovative products or services with high technological content in the energy

sector.

INNOVATIVE START-UPS

Fiscal Policy

Tax credit for hiring highly qualified personnel. The tax credit is of 35 per cent of

the cost sustained for hiring of a worker with a permanent contract, with a

maximum limit of €200,000 per year for each business.

TAX CREDIT FOR HIRING

HIGHLY QUALIFIED

PERSONNEL

Fiscal Policy

Favoured tax regime for the repatriation of researchers and highly qualified

personnel is extended to 2016 and 2017 for all the people coming back to Italy

within end of 2015 (2016 Stability Law).

FAVOURED TAX REGIME

FOR REPATRIATION OF

WORKERS

Fiscal Policy

To support the possibility of young people to become researchers, the

endowment of the Fund for the Ordinary Financing of Universities is raised of

€47 million in 2016 and €50,5 million yearly starting from 2017. Funds

allocation between Universities and Research Centres is done considering: the

results of the Assessment of research quality 2004-2010, for the Universities;

and, the criteria of FOE distribution for Research Centres.

YOUNG RESEARCHERS


and contractual

framework

Hiring of 215 researchers in public Research Centres, with a fund allocation of

€8 million for 2016 and 9.5 million yearly starting from 2017. A previous decree

set the extraordinary hiring of 861 university researchers. The assignment of

places consider the quality of both research produced by the Centres and their

budget.

YOUNG RESEARCHERS


and contractual

framework

The ‘Patent Box’ tax benefit is usable by all firms without limit of turnover,

regardless of of their legal form, economic sector or accounting regime adopted.

The tax benefit consists in excluding from income 50 per cent of yields coming

from the direct/indirect use of software protected by copyright, industrial patents

and trademarks, designs and models, as well as processes, formulas and

information related to industrial, commercial or scientific experiences being

legally protectable. If more than one product are used as complementary in the

production cycle, they can be considered a sole immaterial product for the patent

box discipline. The benefit is calculated as a ratio between the costs for R&D

activities borne to maintain, improve and develop the immaterial good

(numerator) and the total production costs for that good (denominator).

PATENT BOX

Fiscal Policy

Calls for the implementation of the Digital Agenda in the ICT field and on issues

relevant to the sustainable industry; incentives to R&D projects of small and

medium technologies in areas identified by the Horizon 2020 Programme.

FUND FOR

SUSTAINABLE GROWTH

Business environment

MEF-EIB agreement to sustain R&D projects for both SMEs and Mid-Cap

businesses. The initiative entails the use of €100 million from the Central

Guarantee Fund for SMEs to cover the risks of initial losses on industrial

innovation projects undertaken by SMEs and Mid-Caps. As a result of such

funding, the EIB will activate a €500 million loan portfolio.

R&D IN SMEs




Cont’d


POLICY

2 - R&D

[1,53% of GDP]

Industrial research and experimental development Projects in technological

areas of Horizon 2020 so far have generated more investments in R&D for

€525m. In addition, the following actions have been implemented: i) industrial

research and experimental development Projects in electronic information and

communications technology (ICT); ii) industrial research and experimental

development Projects in “sustainable industry”.

R&D INVESTMENTS


Simplification for non-EU citizens willing to stay in Italy to launch an innovative

start-up in our Country.

Simplification and

reduction of

administrative burden

Procedures for innovative SMEs to access the Central Guarantee Fund have

been further simplified.

CENTRAL GUARANTEE

FUND FOR SMEs

Bank credit

€92 million have been allocated to finance the base research of Universities and

Entities monitored by the MIUR (New call PRIN 2015). In addition to extra funds,

the regulation stipulates the possibility of attributing the supervision of research

team to the researchers with temporary contract. More flexibility and

independence in project management are foreseen, as well as on-line

procedures.

UNIVERSITY

RESEARCH


Resources for €4.7 million for the project “Disegni+3” which promotes the

production and marketing of products related to a registered design and €2.8

millionfor the project “Marchi+2” which aims to support the innovative and

competitive ability of SMEs to the internationalisation of its brands. Moreover,

the benefit "BREVETTI+2" has the objective to enhance the existing patents and

the most qualified projects deriving from the public and private research results,

to help micro, small and medium enterprises that intend to pursue a

development strategy through valorisation of industrial property rights

VALORISATION OF

INDUSTRIAL

PROPERTY RIGHTS


Memorandum of Understanding signed between MEF, Cassa Depositi e Prestiti

(CDP), Sace and Abi, to make available to SMEs resources for €1 billion granted

by banks on favorable terms in order to finance investments in innovation and

internationalisation.

‘2i per l’impresa’

initiative - innovation &

internationalization–


National Research Plan for 2016 aimed at promote industrial competitiveness

and the development of the country. The Plan is divided into six core programs:

Internationalisation, human capital, research infrastructure, public-private,

Mezzogiorno of Italy and efficiency and quality of expenditure. Allocated

resources for €2.5 billion in the 2015-2017 period (€4.7 billion for the 2015 to

2020 period). For the 2015-2017 period allocated also additional resources in

for €3.8 billion (€9.4 billion for the 2015-2020 period), from the Regional

Operational Programs and the Horizon 2020 Programme.

NATIONAL RESEARCH

PLAN


3 – Greenhouse gas

emissions [-13%]*

Strengthened the involvement of local authorities in the energy and environment

sustainability through many institutional activities, including the “Mayors’

Agreement”.

ENERGY

SUSTAINABILITY

Environmental policies

Strengthen the supervision and assessment on substances depleting ozone:

continued activities related to data collection on greenhouse gases fluorinated

emissions as well as the supervisory and assessment activities in order to

impose any sanctions, the monitoring of businesses registered in the F-gas

Register, and the adjustment of certification and training programs, as provided

by the European Reg. no 517/2014.

SUPERVISION ON

SUBSTANCES

DEPLETING OZONE




Cont’d


POLICY

3 - Greenhouse gas

emissions

[-13%]*

€5 million in 2016 for the special program of tests on new vehicles and vehicles

in circulation. In February 2016 adopted the decree of MIT establishing technical

arrangements and procedures for the implementation of this programme.

ENVIRONMENTAL

POLICIES

Fund at MIT for the purchase or rental of vehicles used in local and regional

public transport and for the upgrading of the electric vehicles. Provided,

additional financial resources, for €210 million for each of the years 2019 and

2020, €130 million for 2021 and €90 million for 2022.

FUNDS FOR

SUSTAINABLE

MOBILITY


Allocated €35 million for an experimental national program of sustainable

mobility from home-to-school and from home-to-work. Resources came from

projects it is possible to allocate 50 per cent of the proceeds from the auction for

the exchange of greenhouse gas emission allowances as provided in art. 19

Lgs.D. no. 30/2013.

SUSTAINABLE

MOBILITY

PROGRAMME


With Programme Agreements signed with metropolitan areas and a Public call

for Municipalities and for resources of the Fund for sustainable mobility,

activated 187 interventions (for a total value of €370 million) in favor of 106

municipalities, including 14 capitals in metropolitan area and 92 municipalities

with over 30,000 inhabitants, representative of the entire national territory, co-

financed for a total amount of about 200 million.

AGREEMENTS WITH

LOCAL ENTITIES


Implementation of the National Strategy of adaptation to climate change by

agreement of the Ministry for the Environment, Land and Sea, to be concluded at

the Conference of State and Regions to define roles and responsibilities for the

implementation of actions and measures adaptation and coordination

instruments between different levels of territorial government, and the

arrangements for monitoring and evaluation of the effects of adaptation actions.

NATIONAL STRATEGY

OF ADAPTATION TO

CLIMATE CHANGE


Upgrading of the Conto termico for renewable heating (incentive mechanism

scheme for energy efficiency measures in the public administration buildings and

for installing facilities of thermal energy from renewable sources).

ENERGY EFFICIENCY


4 – Energy from renewables

[17%]

Managing projects implemented through the public call on the analysis of the

carbon footprint in the lifecycle of consumer products and public call for co-

financing projects carried out by public entities for the use of technologies for

energy efficiency and renewables.

ENERGY EFFICIENCY


Energy plants fuelled with biomass, biogas and sustainable biofuels will benefit

from an incentive on produced energy until the end of 2020, calculated as the

80 per cent of the incentive for new plants. The incentive will be distributed by

GSE after the EU Commission decision on State aid.

INCENTIVES ON

SUSTAINABLE PLANTS


Extension - until 31 December 2016 - of the tax deduction to 50 per cent for the

installation of photovoltaic systems in buildings. Introduced procedural

simplifications for the authorization of the same plant

DEDUCTIONS FOR

PHOTOVOLTAIC


Incentives for the construction of new electricity production plants from

renewable sources different from the photovoltaic, with a power of about 1300

MW

INCENTIVES ON SU-

STAINABLE

PLANTSEnvironmental

policies

Program of buildings energy requalification of the central public administration,

for the implementation of which € 350 million has been allocated in the period

2014-2020.

ENERGY

REQUALIFICATION


5 – Energy efficiency [15,5

Mtep/year]**

National revolving fund for energy efficiency, to provide guarantees and

subsidized loans for the realisation of investments on energy requalification of

public administration buildings and housing, for improving the efficiency of public

lighting and for the construction of district heating networks.

NATIONAL REVOLVING

FUND FOR ENERGY

EFFICIENCY




Cont’d


POLICY

6 –School drop-out rates

[16%]

Foreseen at least 400 hours in the last three years of technical and professional

institutes and 200 in the high schools (licei) for the school-job transition, with a

budget of €100 million per year.

SCHOOL-JOB

TRANSITION

Education

School-job transition mandatory for students of the last three years of secondary

school. From January 2016 allocated €100 million per year and signed a

Memorandum of Understanding between the Ministry of Education and

Confindustria to develop skills and abilities professionally to be used on the

labour market. Revision of the apprenticeship discipline: as required in

implementation of Lgs.D. no. 81/2015, are defined training standards and

general criteria for the realisation of apprenticeship.

SCHOOL-JOB TRANSI-

TION


policies

Allocated €93 million to promote the active involvement of students into school

life, for the inclusion and integration of students.

ACTIVE INVOLVEMENT

OF STUDENTS

Education

Improved the language skills, enhanced competences on subjects such as Art,

Music, Law, Economics, and expanded school sport schemes.

TEACHING SUBJECTS

Education

Fund for the Fight against educational poverty for €100 million a year for the

2016-2018 period, to support measures against education poverty, powered by

payments by banking foundations. For deposits made, institutions will benefit

from a tax credit of 75 per cent for each year of the Fund experimentation.

EDUCATIONAL

POVERTY

Poverty

National Plan for Digital School: a comprehensive strategy made up of 35

measures concerning ultra-broad band infrastructures, new digital skills for

students, online tools for education, promotion of Open Educational Resources

(OER), school-job transition in digital business, and training for the school staff.

NATIONAL PLAN FOR

DIGITAL SCHOOL

Education

To improve the integration and hospitality of students with non-Italian citizenship

allocated resources for €1 million (€500,000 for the enhancement of Italian as a

second language, and €500,000 for projects related to hospitality and linguistic

and psychological support dedicated to unaccompanied minors).

INTEGRATION AND

HOSPITALITY

Education

7 – Tertiary Education [26-

27%]

Aligning university courses to the school needs. Started the revision of the

different classes of competition in order to adapt the classes of competition to

the new university system. In this way, some categories of graduates so far

excluded from teaching subjects in line with their curriculum will have access to

specific paths enablers.

ALIGNING UNIVERSITY

COURSES

Education

To ensure adequate training provided by universities until a 2017/2018, in the

universities where the limits to staff turnover are likely to impose a halt to some

courses to the detriment of students foreseen a MIUR decree. The decree

provide the inclusion of the contract hired professors in the calculation of the

minimum number of teachers needed to maintain a degree course.

CONTRACT HIRED

PROFESSORS

Education

Increase of the Fund for ordinary financing of State Universities (FFO): €6 million

for 2016 and €10 million from 2017 for recruiting of first and second tier

professors according to national procedures. A special Fund has been created

with an endowment of €38 million for 2015 and €75 million from 2017 for the

recruitment of professors through direct call and in accordance with criteria

designed to reward excellence and scientific qualifications of the candidates. For

the recruitment of researchers allocated €47 million for 2016 and €50,5 million

from 2017. In addition, the ordinary Fund for research organizations (Foe) is

increased by €8 million in 2016 and €9.5 from 2017 to recruit 847 researchers

by the University, with a non-renewable three-year contracts to consolidate the

position of associate professor. Provided a recruitment by research institutions

to further 200 units.

RECRUITMENT

UNIVERSITY

PROFESSORS

Education



Cont’d


POLICY

7 - Tertiary Education [26-

27%]

Increase of the Fund of medical specialisation for the following amounts: €57

million for 2016, €86 million for 2017, €126 million for 2018, €70 million for

2019 and €90 million from 2020.

MEDICAL

SPECIALISATION

Education

Resources to university colleges for €3 million. To support the access to

university courses of students came from low income families allocated

additional resources for the Integrative Fund for Grants: the total amount is

raised by €54.75 million in 2016 and further €4.7 5 million from 2017.

Scholarships granted for Erasmus Plus, are excluded from the IRPEF tax base

and INPS contributions.

FUNDING UNIVERSITY

COLLEGES

Education

8 - Poverty / social exclusion

[Reduction of 2,200,000

people in or at risk of

poverty, deprivation and

social exclusion].

The Fund for non-self-sufficient has been increased by €400 million per year

including resources for interventions in support of people with amyotrophic

lateral sclerosis (ALS). The National Fund for Social Policies has been increased

of €300 million from 2015. Created a specific fund to sustain international

adoptions and for the operation of the Commission for International Adoptions

with resources for €15 million per year from 2016. Allocated resources for €112

million in 2015: €100 million to the relaunching the plan for the development of

the territorial system of socio educational services for infants and €12 million for

distribution of food for a people with low income.

SUPPORT TO PEOPLE

WITH LOW INCOME

Poverty

Raised the limit of free goods supplied beyond which it is necessary to send the

communication in writing to financial administration in case of free distribution

to organizations, associations or foundations with the single purpose of

assistance, charity, education, instruction, study or scientific research and NGO.

FREE DISTRIBUTION

OF GOODS

Poverty

Allocated resources for €90 million from 2016 for measures to support persons

with severe disabilities without family support. Allocated €5 million for 2016 for

projects concerning measures to make independent persons with severe

disabilities. Set up a fund of €5 million per year for the care of individuals with

autism spectrum disorder.

SUPPORT PERSONS

WITH DISABILITIES

Poverty

Establishment, on an experimental basis, of a solidarity fund with €250,000 for

2016 and €500,000 for 2017 for the protection of the spouse in need not able

to provide for their livelihood and of their children also with handicap.

SUPPORT TO FAMILIES

Poverty

BONUS FOR BABIES. Monthly allowance of €80 monthly (€960,000 per year) for

each child born or adopted from January 1, 2015 to December 31, 2017, paid

up to the end of the third year of age or the third year of entry in the household in

the case of adoption, for ISEE income not exceeding €25,000 per year.

BONUS BABIES’


policies

Allocated €45 million for 2015 for child support, vouchers for the purchase of

goods and services for families with four or more children with an ISEE income

not exceeding €8,500 per year.

SUPPORT TO FAMILIES

Poverty

FAMILY CARD. Card for families legally resident on Italian territory with at least

three children, according to ISEE income for discounts on the purchase of goods

and services, or tariff reductions by public or private entities. The card is issued

by the individual municipalities and lasting two years.

SUPPORT TO FAMILIES

Poverty

The Fund for the priority needs of low-income citizens has been increased of

€250 million per year from 2015. The Fund is further increased for 2016 by

€380 million. Starting from 2014 the social card was extended to EU and extra

EU citizens and their families, as well as to foreigners having a residence permit

for EU long-term residents.

SOCIAL CARD

Poverty



Cont’d


POLICY

8 - Poverty / social exclusion

[Reduction of 2,200,000

people in or at risk of

poverty, deprivation and

social exclusion].

Engagement of beneficiaries of income support instruments in activities of social

interest. Persons receiving income supports can perform a voluntary activity of

social utility on behalf of their own communities, in projects carried out jointly by

no-profit sector organizations and municipalities or local authorities.

SUPPORT TO PEOPLE

WITH LOW INCOME

Poverty

Resouces for €1.8 billion to support the agreed rental contracts, a greater supply

of social housing and the development of social housing building projects.

HOUSE PLAN

Poverty

Increased funds for rent by €100 million in the 2014-2015 period and the Fund

to cover unintentional rents arrears by €210 million for 2014-2020. Allocated

€400 million for a plan of recovery of social housing owned by the ex-Public

housing Association (IACP) to promote energy, plant engineering and the static of

buildings and €67.9 million for the recovery of additional accommodation ex

IACP to be allocated to social disadvantaged categories. The Guarantee Fund for

the primary residence has been boosted and the range of beneficiaries for loans

granted with the purpose of purchasing, renovating and improving energy

efficiency of their first home has been increased. Tax benefits for the 2014-2016

period on behalf of the conductors of social housing used as the main residence.

RENTS

Poverty

To avoid dismissals, extended for 2016 the contribution in favor of companies in

the handicraft sector that have activated solidarity contracts. In particular, for

contracts signed before October 15, 2015, the contribution (equal to half wage

of lost hours) is paid until the end of the solidarity contract. For those signed

later, the contribution is recognized until 31 December 2016. For this measures

are allocated €60 million for 2016.

SOLIDARITY

CONTRACTS

Poverty

Increased the no tax area for retired persons with a total income of €15,000. SOCIAL SECURITY

Poverty

Special Fund for fighting poverty with €600 million for 2016 and €1 billion

starting from 2017. The Plan is a three-years plan and identifies the

achievement of the basic level of welfare benefits to ensure on the national

territory for the fight against poverty. For 2016, the interventions will be aimed

primarily at families in proportion to the number of children and the disabled.

Resources for 2016 include: €380 million for the extension of the social card

nationwide; €220 million for unemployment benefit schemes ASDI (semi-annual

support recognized to unemployed without unemployment benefits and family

burden at or below €5 thousand). For 2016 €380 million will be allocated for an

experimental Programme for active inclusion, aimed at overcoming the condition

of poverty, inclusion/reintegration working and social inclusion. From 2017 the

resources for €1 billion are used for a single national measure for fighting

poverty and rationalisation of existing instruments and services. From 2016, the

Fund for fighting poverty and Social Exclusion include resources for €54 million

per year for social safety nets.

NATIONAL PLAN TO

FIGHT POVERTY AND

SOCIAL EXCLUSION

Poverty

* The Italian target of 13 per cent for reduction in emissions compared to 2005, in 2020 concerns the non-ETS

sectors.

** The energy efficiency target is detected in savings on end-use as required by the EU Directive.

appendix to 2016 national reform programme€¦ · reform of civil justice (d.l. no. 132/2014, cvt....

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