When we talk about “Industry 5.0” we are referring to the last, in chronological order, evolutionary step of the industrial revolution.
The moment of transition in which technology not only automates processes, but also makes them more human, putting human-machine interaction at the center.
Integrating measures with the National Recovery and Resilience Plan (NRP), the government has put in place a strategic plan to facilitate this transition by offering businesses significant incentives to adopt advanced and sustainable technologies.
The plan for Industry 5.0
The Industry 5.0 plan aims to create a manufacturing ecosystem in which digitization and environmental sustainability go hand in hand.
This program is based on four main pillars: technological innovation, sustainability, human-centeredness and infrastructure resilience.
Through this plan, the government aims to support businesses in adopting advanced technologies such as artificial intelligence, the Internet of Things (IoT), collaborative robotics and blockchain, while promoting environmentally friendly and responsible practices.
Incentives and facilities for enterprises
To facilitate the transition to Industry 5.0 and the subsequent adoption of new technology infrastructure and implementation of new services, the government has provided a number of incentives and tax breaks.
These include tax credit for investment in capital goods, tax credit for research and development, and grants for personnel training.
Tax breaks for companies that invest in environmental and social sustainability projects are also part of the plan.
These incentives are designed to make the adoption of new technologies more affordable and to support businesses on the path to digital transition.
The tax credit provided to encourage the transition to Industry 5.0 varies according to the type of investment made by companies.
The recipients of the Transition 5.0 Plan.
All companies resident in Italy, including permanent establishments of nonresidents, can access the incentives, regardless of legal form, economic sector, size or tax regime.
Enterprises must make new investments in facilities located in Italy and comply with occupational safety regulations and contribution obligations.
Enterprises in liquidation, bankruptcy, arrangement with creditors without business continuity, or subject to other bankruptcy procedures, as well as those affected by prohibitory sanctions, are excluded.
The incentive scheme and the tax credit
Of the €11.8 billion allocated to Mission 7 – RePowerEU, €6.3 billion is reserved for three types of investments:
- digital assets: tangible capital equipment 4.0 and intangible 4.0, for which 3.78 billion euros in tax credits are provided.
- Self-generation and self-consumption from renewable sources: excluding biomass, with 1.89 billion allocated.
- staff training: skills for digital and energy transition, with a budget of 630 million euros, limited to 300 thousand euros and not exceeding 10 percent of investment in digital assets.
The rates and investment brackets
The incentive applies only if the investment results in a reduction of at least 3 percent in the energy consumption of the production facility or 5 percent in the process involved.
Investments are divided into three brackets with different tax credit percentages:
- up to 2.5 million: 35 percent of expenditure
- 2.5 million to 10 million: 15 percent of expenditure
- over 10 million euros: 5 percent of expenditure, up to a maximum of 50 million euros.
The percentages increase if the reduction in energy consumption exceeds certain thresholds: 6 percent or 10 percent for the production facility, 10 percent or 15 percent for processes.
Cumulability with other facilities
The tax credit cannot be combined with that for investments in new capital goods provided for by Law 178/2020 (Transition 4.0 Plan) nor with the credit for investments in the Unique Special Economic Zone of Southern Italy.
It is possible to cumulate with other facilities for the same costs, but without exceeding the total investments made.
Energy efficiency and the role of the GSE
Investment 15 of Mission 7 aims to support the energy transition to sustainable, renewable-based production models, with expected energy savings of 0.4 Mtoe (million tons of oil equivalent) between 2024 and 2026.
Companies must document the reduction in energy consumption and submit detailed projects to GSE (Gestore Servizi Energetici), which will verify and forward the list of eligible companies to MIMIT. Operational aspects and the implementing decree The recent MIMIT Decree defines the implementation modalities of Article 38.
This decree, which has been submitted to various ministries and the Court of Auditors, clarifies the operational details, how to transmit the required communications and certifications.
In addition, it specifies the criteria for determining energy savings and the procedures for taking advantage of the tax credit, as well as indicating the entities authorized to issue ex ante and ex post certifications, characterized by independence and professionalism.
Here is an overview of the main tax credit rates available.
Tax credit for investment in capital goods
- Tangible Assets 4.0: For investments in technologically advanced capital goods (included in Annex A of the 2017 Budget Law), the tax credit is 40 percent of the cost for the portion of investments up to 2.5 million euros and 20 percent for the portion of investments above 2.5 million euros and up to 10 million euros.
- Intangible Assets 4.0: For investments in technologically advanced intangible capital goods (included in Annex B of the 2017 Budget Law), the tax credit is 20 percent of the cost for the portion of investments up to €1 million.
Research and Development, Innovation and Design Tax Credit
- Research and development: the tax credit is 20 percent of eligible expenses, with an annual maximum of 4 million euros.
- Technological innovation: equal to 10 percent of eligible expenses, raised to 15 percent if activities are aimed at ecological transition goals or digital innovation 4.0, with an annual maximum of 2 million euros.
- Design and aesthetic conception: the tax credit is 10 percent of eligible expenses, with an annual maximum of 2 million euros.
Training 4.0 tax credit
The tax credit is 50 percent of eligible expenses for small companies, 40 percent for medium-sized companies and 30 percent for large companies, with an annual maximum of €300,000 for each company.
These tax credits represent a significant opportunity for Italian companies to reduce the costs associated with the transition to Industry 5.0 by incentivizing the adoption of advanced and sustainable technologies.
It is important that interested companies keep abreast of the details and how to access these incentives to maximize the benefits from their investments.
Deadlines and regulatory obligations
Companies that intend to take advantage of Industry 5.0 incentives must meet certain deadlines and regulatory obligations.
First, it is essential to submit the application by the deadlines set annually by the Ministry of Economic Development. The application deadline is December 31, 2025.
In addition, companies must ensure that their projects comply with the technical guidelines set by the government, which include criteria for technological innovation and sustainability.
It is important to keep detailed records of investments and activities carried out, as they may be subject to monitoring and audits by the relevant authorities.
Practical information for businesses
To facilitate access to the incentives, the government has made a number of information and support tools available to businesses .
These include first and foremost dedicated online portals, where it is possible to find all the necessary information on requirements, how to apply and deadlines.
In addition, there are free advisory services offered by public agencies and trade associations, which can help businesses navigate the various opportunities and prepare the necessary documentation.
Companies can also participate in seminars and workshops organized at the national and regional level, including by trade associations, to learn more about Industry 5.0 issues and share experiences and best practices.
The 5.0 Transition Plan represents a unique opportunity for Italian companies to innovate and grow, in an increasingly competitive and sustainable market.
Thanks to the government’s plan and available incentives, companies can successfully address the digital transition while improving their sustainability and quality of work.