With reference to the tax treatment of the incentive tariff, the Revenue Agency issued the Circular no. 46/E on the 19th July 2007 concerning the “Disciplina fiscale degli incentivi per gli impianti fotovoltaici” (Rules regarding tax reliefs for photovoltaic systems”)

Regarding the tax treatment of the incentive tariff it is important to state that the financial Administration clarified that this is not subject to VAT, even if the subject would install the photovoltaic system for business, arts and crafts or profession, since the incentive tariff is a grant, received by the subject without the need to pay the money back to the funding source.