Fiscal Policy for Sustainable Development: The Italian Way to Promote Innovative Entrepreneurship According to European Union Rules

Abstract

According to theoretical studies and empirical approaches, there is a link between taxation, innovation, and sustainable development: the more a Government seeks to ensure the birth, growth, survival, and competitiveness of innovative and sustainable firms, the better it must diversify and reinforce the national entrepreneurship ecosystem. A suitable solution is to develop new tax rules that support them. This study seeks to fill the existing gap in literature on the synergy between specific fiscal policies introduced in favor of innovative entrepreneurship in line with EU State Aid rules, development, and sustainability by analyzing the Italian strategy. At least, the objective of the researcher is to provide some valuable suggestions to European policymakers developing new rules and measures with the same goal and also an inspiration for enlightened entrepreneurs. The method selected initially proposes an overview of Italian legislation to clarify why it is considered compatible with the European rules, followed by a proper analysis which clarifies its remarkable outcomes. Subsequently, the outcomes are highlighted through the development of the Italian strategy over the last 6 years, with the aim of reinforcing the initial assumption: the significance of an addressed fiscal policy for the sustainable development of an innovative business ecosystem. Indeed, innovative enterprises, achieving rapid growth, attracting international investments and representing a driving force for sustainable development - understood as the ability to cope with environmental, economic and social changes - have a broad impact on both overall productivity and new job opportunities.