1. Background

By decision dated 29 May 2019, n. 6784, the Regional Administrative Court of Lazio – Rome acknowledged the possibility to cumulate the tax benefits as provided pursuant to the so-called “Tremonti Ambiente” (Law no. 388/2000) with the feed-in tariffs provided pursuant to the Conti Energia III, IV and V.

The matter originates in an application in which various small and mid-sized businesses operating in the PV sector raised a challenge to the communication issued by the GSE which excluded the possible accumulation of feed-in tariffs under the Conti Energia III, IV and V with the tax benefits pursuant to article 6 of the Tremonti Ambiente law. In that same communication, the GSE also granted the applicant companies a deadline within which to acknowledge that they had waived the above-mentioned tax benefit, in order that they could maintain the feed in tariffs applied to them.

Article 6 of the Tremonti Ambiente stated that the share of income of small and mid-sized companied destined for investments in the environment was not calculated for the purposes of determining taxable income for the purpose of corporation tax, therefore constituting a tax benefit.

In this scenario, multiple operators in the photovoltaic sector benefited from the accumulation with the feed-in tariffs applied pursuant to the Conti energia III, IV and V.

2. The GSE’s thinking

The GSE had excluded the possible accumulation of both benefits on the assumption that the provisions contained in the Conti Energia III, IV and V do not include, in the exhaustive list of public contributions and benefits excluded from the prohibition on cumulating, the benefit under the Tremonti Ambiente.

On the basis of that assumption, the GSE informed the applicant companies that “if you wish to continue to benefit from the feed in tariffs under the III, IV and V Conto Energia, it is necessary to waive the tax benefit in question”, and therefore “expressing said intention to the Tax Authority in the manner and according to the procedure provided by it, within the twelve months following the publication hereof, providing proof to the GSE of the relevant request and therefore of the effective waiver of the tax benefits”.

3. The decision of the Regional Administrative Court of Lazio – Rome dated 29 May no. 6784

In granting the application, the Regional Administrative Court disagreed with the reasoning of the GSE regarding the accumulation of the benefits under the Tremonti Ambiente and the feed-in tariffs provided pursuant to the Conti Energia III, IV and V and annulled the communications issued by the GSE that had been the subject of challenge.

The administrative judge issued an interpretations that was the opposite of that provided by the GSE stating that “the ’inclusion of the environmental detaxation among the “public incentives” referred to by the conti energia was clearly approved by art. 19 ministerial decree dated 5.7.2012, […]” and that, therefore, “the above mentioned provisions allow the cumulating of the benefits in question including those in relation to the Conti energia following the II”.

As a result of this decision, the possibility to apply both the tax benefit under the Tremonti Ambiente law and the feed in tariffs under the Conti Energia III, IV and V has been recognised.

The decision is still open to appeal by the GSE before the Council of State but, at least for the time being, operators in the photovoltaic sector will not have to waive the tax benefit in questions in order to benefit from the feed in tariffs applied to date, given the annulment of the communications from the GSE requiring said waiver.