Strengthening the Company Capitalization Incentive (ICE) tax regime will cost the State 180 million euros. The measure, contained in the medium-term agreement to improve incomes, wages and competitiveness, signed between the government and social partners on October 7, is now being implemented in the proposed 2024 state budget (OE2024), which was presented to parliament on Tuesday submitted.
With this resolution, all companies that are financed with their own capital, rather than with debt, for example through contributions from partners or through undistributed profits transferred in the form of reserves, will now benefit from a greater deduction from business income. Tax (IRC), albeit for a shorter period, from January 1, 2024.
In its current version, the ICE tax regime, which was created in 2023 to simplify tax incentives for business capitalization, allows the deduction of 4.5% of that tax collection – or 5% if the taxpayer qualifies as a micro- , small or mid-cap. company or small and medium-sized enterprise (Small center cap) – over a period of ten years.
The proposal for 2024 provides for the extension of the benefit to a variable interest rate indexed to the 12-month Euribor, plus a scatter 1.5%, or 2% if it concerns that group of companies. In addition, the government will increase the basic amount by 50% in 2024, by 30% in 2025 and by 20% in 2026, with the calculated amount limited to two million euros or 30% of EBIDTA, whichever is greater is.
Source: DN
