On Thursday, 24 July 2018 the Regulations were published in the Official Gazette specifying how to access the tax incentives due to planned advertising investments made in press (newspapers and magazines, local and national, online and offline) and on local radio-television stations. All of this will enter into force on 8 August 2018, implementing Article 57-bis, paragraph 1 of the Decree-Law 24 April 2017, n. 50.
In other words, it is an important tax advantage to companies, self-employed and non-commercial entities that invest in advertising campaigns in the media mentioned above. For this project, in 2018, 62.5 million euros were allocated, of which 50 million (20 for the second half of 2017, 30 for 2018) for investments in the press and 12.5 million for investments made in 2018 on radio-TV.
Now, We are going to analyze more thoroughly the contents of the Regulation that will soon be adopted.
The subjects who can require for the tax credit are: companies or self-employed that from 1 January 2018 have invested in advertising campaigns with a value of more than 1% compared to the same period of the previous year on the same media (means press and radio-TV, not individual newspapers or stations). During the first implementation, the investments for the second half of 2017 (from June 24th to December 31st) will also be evaluated, always with the same incremental threshold of 1% minimum, referred to 2016. This benefit extension concerns only investments in online and offline press, thus excluding the radio-tv media.
Some restrictions also affect the contents. In fact, the purchase of advertising space for special services, such as teleshopping, games and betting with cash prizes or chat-line, remains excluded from the tax credit. Moreover, to receive the benefits, you have to cont the costo without brokerage costs and other auxiliary expenses. Finally, the tax credit can not be combined with other concessions provided by national, regional or Community regulations.
To access the benefit it is necessary to submit the request to the Revenue Agency in electronic communication form on the appropriate platform with the procedures defined therein. Specifically, the communication must contain:
- Identification data of the self-employed or company
- Cost of investments in advertising carried out during the year
- Cost of investments on the same media of the previous year
- The increase in investments (divided between press and radio-TV) in percentage and in absolute value
- The amount of tax credit required
- A declaration concerning the possession of the requirements to access the benefit
How much is the tax credit? For the year 2018 it was decided that each applicant will be awarded 75% of the incremental value of the investments made. This percentage rises to 90% in the case of micro-enterprises, small and medium-sized enterprises and innovative start-up. If the amount of benefits requested exceeds the amount of resources allocated the tax credit will be lower and there will be a percentage distribution of the resources among all applicants. Instead, if the sum allocated should exceed that requested, the difference will increase the financial donation of the following year.
Now that we have made clear the Regulation that will facilitate and increase the advertising activities of many companies, we recommend to create strategically investment decisions, even in order to exploit the available resources.
Contact E-Business Consulting srl for the creation of online communication campaigns. We offer Programmatic Advertising services, that is the acquisition of online advertising space, and Native Advertising to allocate advertising in a natural and coherent way in online press. For other services, please visit our website.