by Giuseppe Calabi
For centuries, patrons have been the economic drive of the arts: from noble and Papal courts to the bourgeois patronage, the cultural elite has often helped artists.
Yet, the Italian system has long ignored private initiatives: in fact, regarding the protection of cultural heritage, it has always been suspicious of such phenomenon.
Now, this trend seems to have changed thanks to Legislative Decree May 31st 2014, n. 83 “Urgent measures for the protection of cultural heritage, cultural development and the relaunch of tourism”, subsequently amended and turned into Law 106 of July 29th 2014, which introduced the so-called Art Bonus: a form of tax credit in favour of any natural or legal person who invests in the conservation of Italy’s cultural heritage.
The tax credit, which is divided into three equivalent annual tranches, amounts to 65% of the disbursement made. For natural persons and non-commercial entities, it can reach up to 15% of the taxable income while, for business income, it can be up to 5%.
Nevertheless, not all donations in favour of the conservation of cultural heritage generate tax credit but only those aimed at financing the “maintenance, protection and restoration of public cultural heritage, in order to support public cultural institutions” (art. 1, comma 1 L. 106/2014). Therefore, if the donation is in favour of the protection of non-public cultural heritage, even in case of assets belonging to non-profit associations or organisations (which receive equal treatment as regards public cultural heritage in the Code of Cultural Heritage), it doesn’t grant tax credit as envisaged by the law on the Art Bonus.
The Art Bonus cannot be applied to the purchase of cultural assets (that is to say, those objects that, due to their cultural value, have been “notified”).
Another reasonable limit connected to the Art Bonus lies in the fact that the donation must be “traceable” (for example, via bank transfers, debit or credit card, cheque but not cash payments). Such limitation is also in line with the norms in force, which limit the use of cash.
The Art Bonus, however, should not be confused with the promotion of cultural heritage envisaged by the Code of Cultural Heritage (art. 120, L. D. 42 of January 2nd 2004): such bonus, in fact, is not aimed at promoting a name, a brand, an image, the activities (or their results) carried out by the donor who is simply acknowledged for the donation made. Such acknowledgement is not mandatory for the beneficiary body (for example, mention on a website dedicated to the bonus and/or mention of the beneficiaries, subject to prior agreement of the patron or the public acknowledgement of the latter).
After a slow start, despite the initial scepticism, in September 2017 the donations covered by the Art Bonus reached € 180,694,028.00, involving more than 7,000 donors, both natural persons and businesses.
A quick comparison: the French system
It is always interesting to examine how patronage works in other countries, for example, in neighbouring France, whose system of protection and enhancement of cultural heritage has recently been the focus of media coverage after the Louvre authorised the circulation of the Mona Lisa.
In encouraging patronage, France has been a pioneer: already in 2003, with law 709 of August 1st 2003 (known as “loi Allaigon”), it introduced a favourable tax regime for both individuals and businesses that support an activity of general interest on a purely liberal basis. The so-called “gift” can consist in a donation in cash, in kind or at the beneficiary’s option: if it falls within the bodies entitled to the “deductible” patronage, the donor is given the possibility to enjoy some tax incentives.
In particular, the companies (or in any case the owners of business income) can enjoy a tax reduction of 60% of the amount of the donation within the limit of 5 per thousand of their turnover. If this threshold is exceeded during a financial year, the excess is calculated as a tax reduction for the following financial year.
For private individuals, on the other hand, the tax reduction is equal to 66% of the donation amount, within the annual limit of 20% of the taxable income, and if this percentage is exceeded, the reduction can be spread over the following 5 years.
Besides, specific tax concessions are envisaged for companies that donate by financing the purchase of a cultural asset recognised as a “national treasure or work of great patrimonial interest” (the equivalent of our “cultural asset”, despite many considerable differences in terms of application) for the benefit of a public collection: in this case, the reduction equals 90% of the amount of the payment made, within the limit of 50% of the tax payable by the company. Unlike Art Bonus, which does not cover the purchase of cultural goods, if the company buys the asset classed as national treasure for its own account, it enjoys a tax advantage of 40% of the sums used for the purchase.
The difference with the Italian system in relation to the organisms eligible for deductible patronage is also noticeable: while in Italy only donations in favour of assets belonging to the public cultural heritage are deductible, in France also donations to private subjects, such as for example recognised associations and public benefit purpose foundations, business foundations and private historical monuments, are subject to deductibility.
Moreover, as just pointed out, donations can be in cash, in kind, or at the donor’s choice: the latter is very interesting as it consists in the services provided as “competent patronage” offered by companies. Once again, a difference emerges with respect to the Italian system, for which only cash donations are deductible.
Finally, it should be noted that in the French system the donor is also offered a “counterpart” for the donation, whose value must not exceed 25% of the value of the donation and, if the donation is granted by private individuals, since 2011, it cannot exceed the flat fee of € 65.
The French patronage system has reached a total amount of over one billion euro in 2016, a figure that would make our Art Bonus budget turn pale.
Surely the Art Bonus has room for improvement. However, turning individual citizens and businesses into the financiers of the Italian cultural heritage, for too long dissociated from any economic aspect that could affect it, was not an easy task. And over 180 million euro is far from a defeat. However, a lot can still be done to improve the virtuous circle of patronage and to bring back the important role that history has assigned to it.