R&D, Italian expenditure still far from the European average

RD Italian expenditure still far from the European average

(Finance) – The number of companies benefiting from the tax credit for expenses in R&D it went from 10,268 in 2015 to 27,072 in 2019: a very low share, equal to approximately 0.3 per cent of the total number of joint-stock companies. This is what emerged from the Focus “Tax incentives for Research and Development in Italy” published byParliamentary Budget Office which analyzes public incentives to invest in R&D, evaluating their convenience for Italian companies in recent years.

Also with regard to the patent box – a favorable tax regime introduced with the 2015 stability law which allows companies to exclude from the tax base (for both income tax and IRAP purposes) a share of income produced by the use of legally protected intangible assets ( such as software protected by copyright or industrial patents) and capital gains (if reinvested at 90 per cent) deriving from their sale -. the number of beneficiaries increased between 2015 and 2019, from 555 to 1,821. The increase is significant, but it concerns a percentage of corporation even lower than that of the tax credit.

Regarding the distribution territorialin 2020 66 percent of the companies that benefited from the tax credit were in the North, just under 20 percent were in the Center and about 15 in the South. For the patent box, however, the territorial differences are even more accentuated: in 2019 almost 72 percent of users were located in the North (and benefited from 79 percent of subsidized income), while companies located in the South represented only 11 percent of beneficiaries (and less than 3 percent of subsidized income).

Despite growing from 1.2 to 1.5 per cent of GDP between 2011 and 2020, Italian R&D spending remained consistently and significantly below the EU-27 average, which rose from 2 to 2.3 per cent over the same period. Despite the incentives, in 2020 we were also met by the Greece, which in 2011 was the European country with the lowest R&D expenditure (0.7 per cent of GDP). In recent years in just six European countries – Austria, Belgium, Denmark, Finland, Germany and Sweden – spending has exceeded 3 per cent of GDP, the target set by the European Commission.

The low level of expenditure is also reflected on the front of patents. In 2020 Italy, with 76.5 patent applications per million inhabitants, slightly exceeds half the EU average (144.4) and ranks tenth in Europe. In the top positions there are still the countries of Northern Europe – Denmark, Finland, the Netherlands and Sweden – together with Austria and Germany, with values ​​ranging from 255 to 435 patent applications per million inhabitants.

Furthermore, Italy has a value ofinnovation index (European Innovation Scoreboard of the European Commission) lower than the EU-27 average, although between 2015 and 2022 it improved its position compared to other countries, moving from sixteenth to fifteenth position.

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