The repeal of a so-called Robin Hood tax on Italian energy firms could offset recent reductions in the feed-in tariff, according to independent power producer Etrion.
A court ruled last week that the levy – which increased corporate tax on most energy companies from 27.5% to 34% – was unconstitutional.
“The reduction of the Italian corporate income tax rate applicable to our solar parks is a significant benefit for us,” said Marco A. Northland, CEO, Etrion. “This change is expected to increase cash distributions from our 60MW portfolio in Italy by almost US$1 million per year, offsetting the effect of the recent reduction in the Italian feed-in-tariff.”
In 2008, large energy companies in Italy had their tax rate hiked to 38% with renewable energy companies also made liable for the higher bracket in 2011. In 2013 the revenue threshold for the tax was lowered drawing in more companies.
Last year the rate was reduced to 34% but energy companies have now successfully challenged it as unconstitutional for its prejudicial treatment of the sector.
A number of firms, including ENEL Green Power and ForVEI have portfolios in Italy equal to or greater than that of Etrion.