Italy recently published Decree-Law No. 176 of 18 November 2022 in the Official Gazette, which contains urgent support measures in the energy and public finance sector. This includes the extension of the following support measures for electricity and natural gas expenses under the same conditions provided for in October and November 2022:

• The 40% tax credit for electricity expenses incurred by qualifying energy-intensive companies is extended for electricity purchased and used in December 2022;
• The 30% tax credit for electricity expenses incurred by other qualifying companies is extended for electricity purchased and used in December 2022; and
• The 40% tax credit for natural gas expenses incurred by qualifying companies is extended for natural gas purchased and used in December 2022, with the credit increased to 40%.

In addition to the tax credits, the Decree-Law also extends the reduction in the excise duty rates on different fuels, as well as the reduction in the VAT rate to 5% on natural gas used for transport. Previously extended for the period 1 November 2022 to 18 November 2022, the reduced rates are further extended for the period 19 November 2022 to 31 December 2022.

In connection with the tax credits, the Italian Revenue Agency has published Circular No. 36/E of 29 November 2022, providing an overview of the applicable tax credits for the third and fourth quarter of 2022, the conditions for and calculation of the credits, and a Q&A.