The Council of Ministers approves the extension of tax bonuses for renovations (50%) and energy-saving measures.
“With the extension of the Furniture Bonus until 31 December 2014, the government has confirmed that it has the interests of citizens and one of the country’s most important production sectors at heart,” said FederlegnoArredo president Roberto Snaidero at the end of the Council of Ministers that approved the Stability Law yesterday evening. The extension by a further 12 months to take advantage of the 50% Irpef deductions for the purchase of furniture for homes undergoing renovation will allow Italians to take full advantage of a tool that, approved in July but only operational since mid-September, allows them to save up to €5,000 over ten years.
Energy saving tax rebates
The tax relief for energy-efficient renovations increases from 55 to 65 per cent, with a double extension: one year for apartment blocks and six months for families and private citizens.
The different duration of the extension of the bonus for energy efficiency in buildings, explained Development Minister Flavio Zanonato, is linked to the possibility of accessing funding from the Kyoto fund managed by Cassa Depositi e Prestiti, a revolving fund for financing measures to reduce greenhouse gas emissions, aimed at implementing the Kyoto Protocol. An interest rate of 0.50% is applied to the subsidised loans, to which the fees charged by the participating bank must be added.
The purpose of the extension of the eco-bonus decided today is related to the duration of the fund. Moreover, it is noted that the average works that an apartment building can carry out are of greater significance and duration than those of an individual flat. The Environment Minister Andrea Orlando continued, “The law had been used a lot for individual flats, less so for apartment buildings. These allow us to take a quantum leap because roofs, common parts and facades are the elements that allow us to increase the energy performance of buildings the most’. In Italy, Zanonato added, we have uneconomical buildings that consume up to 162 kWh per square metre per year and model buildings with a consumption of 16 kWh per year. “The former account for 35 per cent, we plan to shift a substantial share of the most energy-intensive buildings to those that consume less».
Discounts on renovations
In this case, the bonus remains at 50% extended until 31 December 2013. That is, another six months of subsidised works with a ceiling of € 96,000. “This is not a mere extension,” stressed Infrastructure Minister Maurizio Lupi. The main change concerns the extension of the rebates to furniture. Home renovators will have an additional ceiling of € 10,000 (compared to the ordinary € 96,000) to spend on the purchase of furniture for the flat to be renovated. The sum of € 10,000 represents the total “taxable amount” on which the 50% deduction is calculated. In practice, therefore, a maximum rebate of € 5,000 is granted, to be divided into ten annual instalments.
Lupi also confirmed the possibility of using the 50% incentives for earthquake-proof upgrading of buildings (“a government priority”), extended by Decree Law 174/2012 to those affected by the earthquake of 20 and 29 May 2012, including manufacturing plants.
The impact on the market
According to Lupi, 481,500 renovations with 50% rebates began in the last six months for a total value of 8.2 billion. The minister added, “We estimate that the impact on the furniture supply chain,” deriving from the extension of the bonus to furniture “could be two billion over the next six months».
The cost of the extension
The extension of the incentives has an impact of 200 million per year for ten years. This is the estimate provided by Economy Minister Fabrizio Saccomanni, who also explained how the costs will be covered. Part of the funds will be found by raising VAT from 4% to 21% on non-editorial products attached to editorial products, starting in 2014. “About 125 million per year will come from that,” said Saccomanni. The minister added, “another 104 million a year will come from the increase of VAT, from 4% to 10%, on the sale of food and beverages via vending machines.
Heat pumps outside the bonus
Works “to replace heating systems with high-efficiency heat pumps and low-enthalpy geothermal systems, as well as costs for the replacement of traditional water heaters with heat pump water heaters dedicated to the production of domestic hot water” are excluded from the scope of the incentives.
Instead, only work to the “building envelope”, considered as a whole and the “integrated elements and components of a building that separate its interiors from the outside environment” remain within the perimeter of the bonus.
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