October 4, 2018 / 10:16 AM / 8 months ago

Italy mulling bank tax measures to fund budget - govt source

ROME, Oct 4 (Reuters) - Italy is considering a move to reduce the amount of interest payments and accounting losses that banks can deduct from their taxable income as part of measures to fund next year’s budget, a government source said.

The source said it was possible that such a move, which was first reported by Il Sole 24 Ore daily, could be included in the budget law for 2019.

Banks would only be able to deduct 85 percent of interest payments from their tax base and would have to spread writedown losses stemming from the newly introduced IFRS9 accounting rule over a period of two to 10 years, the paper said.

The source also confirmed that the government was considering scrapping tax incentives introduced by the previous executive to spur companies’ capital levels, known as ‘Allowance for Corporate Equity’ or ACE. (Reporting by Giuseppe Fonte, writing by Valentina Za, editing by Giselda Vagnoni)

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