This report is the final output of the analysis undertaken on economic instruments for the circular economy, conducted as part of the in-country support project 21IT01 “Advanced policy instruments to accelerate the circular economy”. The action was funded by the European Union via the Technical Support Instrument, and implemented by the OECD, in co-operation with the Directorate-General for Structural Reform Support of the European Commission.
The work was structured in two distinct phases. During an initial phase, the OECD developed a report that assessed the current use of economic instruments that support Italy's transition to a circular economy. This assessment included policy recommendations based on a review of international best practices. The findings from Phase 1 are detailed in Chapters 2-6 of this report. During the second phase, the OECD carried out a more in-depth analysis on selected fiscal instruments, as agreed with project partners. These instruments were identified as potentially supporting markets for secondary raw materials: virgin material taxation of construction aggregates, VAT reductions on products with recycled content, and corporate income tax incentives. The analysis and guidance from Phase 2 are presented in Chapters 7-10 of this report.
The work was carried out in close collaboration with the Italian Ministry of Environment and Energy Security. The insights presented in this report were enriched by the discussions held during the workshop titled “The role of fiscal instruments to promote the use of recycled materials as part of the circular economy transition in Italy”, which took place on 30 January 2024 in Rome. The workshop saw high participation and engagement from various sectors of the Italian Government and its technical agencies, including the Ministry of Environment and Energy Security, the Ministry of Enterprises and Made in Italy, the Ministry of Economy and Finance, ENEA, ISPRA, ISTAT, as well as the European Commission and selected experts from academia. The authors express their gratitude for the invaluable engagement and insights provided during and following the workshop.