2020 is set to be a year of software investment for many Italian companies. During a summit with leading associations representing Italian businesses, the MiSE (Ministry of Economic Development), stated its firm intention to incentivise Industry 4.0.
A central theme of that meeting, known as Transizione (Transition) 4.0, was the importance of the digitalisation of companies, while maintaining awareness of ecological sustainability. Minister Patuanelli began by presenting data from 2017 to the present, illustrating the recent modernisation undergone by Italian companies, then presented a more detailed look at the Business Plan 4.0 for 2020.
Statistics from Transition 4.0
According to the information presented by MiSE, it has been large and medium businesses who have focused most on Industry 4.0 in recent years. Results achieved by those companies who have decided to update their digital systems (for production and/or management) are impressive.
Meanwhile, the Italian government has taken a proactive approach and has allocated 7 billion Euros to sustain Business Plan 4.0 and related fiscal measures in 2020. The objective is to encourage all Italian companies to recognise digitalisation as a growth opportunity and increase the number of businesses taking part in this initiative by at least 40%.
Between now and 2022, the government plans to introduce tax credits for the circular economy, also known as the green economy. The Plan’s contents can be summarised in three key objectives as follows:
- More investment in digitalisation;
- Involvement of an increasing number of companies;
- Greater awareness of eco-sustainability, with a focus on the research and development sectors and training to provide staff with appropriate skills.
Software investment for SMEs (Small and Medium Enterprises)
Data analysis has shown that investment in latest generation software is not as widespread among small businesses. This negative trend has been widely debated, leading to the development of some special plans involving specific incentives to help SMEs engage with the concept of Industry 4.0.
Moving towards digital and smart working means making Italian industry competitive again, so as to contribute actively to the country’s economic recovery. Considering that the number of small and medium businesses in Italy is high, it is important that they should be incentivised as much as possible.
So the 2020 Business Plan 4.0 aims to help SMEs make that generational switch, using financial investment via business tax credits (resulting from the transformation of super- and hyper-amortisation). More specifically, there are two types of investment available: in tangible materials and in non-tangible materials.
The term ‘tangible materials’ refers to the purchase of machinery, electronic devices and operational equipment. If the cost of these amounts to less than 2.5 million Euros, the tax credit offered to SMEs will be 40% (spread over 5 years for a total of 8% per year). If, however, the investment exceeds 2.5 million Euros (for a maximum of 10 million), the economic incentive offered to companies will be 20%, also spread over 5 years.
The ‘non-tangible’ category on the other hand, includes software and all the other technological components associated with Industry 4.0. The plan offers incentives of 15% for investments of up to 700,000 Euros, spread over 3 years (5% annual tax deduction).
The Ministry (MiSE) is focusing particularly on SMEs, considered to be the beating heart of the Italian economy. These incentives could be the key to driving forward the Industry 4.0 plan and consequently the rest of the Italian economy.
Translated by Joanne Beckwith