Friday, March 6, 2009

ICI Tax on solar farms in Italy - Concern among investors

Great concern among the investors in pohotovoltaic plants in Italy after the decision taken by the Internal Revenue Service (in Italy: Agenzia delle Entrate) to consider PV plants as regular industrial sites.
Under this classification, ground-based PV plants are due to pay the "ICI" tax, namely a "Town Tax on Real Estate" a hundred times higher than if PV plants sites were to be classified as farm-land sites, as it was before. The economic impact would be dramatic, enough to turn down the best IRR-project and to stop any further investment in ground-based PV plants.
The Italian Solar Association "Assosolare" immediately posted a letter to the Revenue Authority and called a meeting to discuss the issue with the Government. In the meantime, ready-to-build solar farms developers are setting up informal negotiations with the local Authorities on a lower-than-formally-due level of tax. This could both grant a go for the project and satisfy the local authorities' hustle for cash from "rich" PV plants. The Classic Italian way to cut corners and speed up the beurocracy.