Brussels, 26/08/2002 (Agence Europe) - The European Commission has ruled that tax measures introduced by Italy in 1998 and 1999 in favour of banking foundations are not subject to Community rules on State aid. The Commission considers that the activity of managing own assets and using the proceeds to donate grants to not-for-profit entities is not an economic activity. Banking foundations are therefore not considered as undertakings within the meaning of the relevant EU rules.
The tax measures that come under this decision were brought in by a law of 23 December 1998 and a legislative decree of 17 May 1999. They concern the attribution to banking foundations of the legal status of "non commercial entities", states a note from the Commission's spokespersons' service, which indicates that this status implies 50% reduction of the standard company income tax in Italy. The other advantages concern the tax exemption on the sale by foundations of the holdings they have in banks or on the acquisition of instrumental goods.
Mario Monti commented on this decision by the Commission. He said "today's decision shows that the Commission carefully draws a line between economic activities, to which the State aid provisions have to be applied in order to protect fair competition in the Union, and non-economic activities, which are not subject to these provisions".