September 26, 2019 / 11:30 AM / 5 months ago

Italy plans tax incentives to help companies raise capital - source

ROME (Reuters) - Italy plans to introduce a tax benefit to help companies raise capital, restoring a measure that had been scrapped one year ago, a government source said on Thursday.

The so-called ‘Allowance for Corporate Equity’ or ACE had been introduced in 2011 and had mainly benefited the country’s banks.

ACE reduces the fiscal convenience to contract debts instead of injecting fresh capital into the companies.

“Restoring ACE is a concrete option,” the source with direct knowledge of the matter told Reuters as the new coalition between the anti-establishment 5-Star Movement and the centre-left Democratic Party is working on the 2020 budget to be presented by mid-October.

Italian financial daily Il Sole 24 Ore first reported the news on Thursday.

The previous administration made up of the 5-Star and the far-right League broke up in August. It abolished the scheme at the end of 2018 to raise money and fund tax cuts for autonomous workers.

Reporting by Giuseppe Fonte, editing by Giselda Vagnoni

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