The Southern Decontribution is an important contribution benefit aimed at supporting employment in the southern regions of Italy. Thanks to the recent extension approved by the European Commission, this measure will be valid until 2029, with a progressive decrease
in relief rates.
What is the Southern Decontribution?
The Southern Decontribution consists of a discount on social security contributions due by employers for employees, with the aim of protecting employment in disadvantaged areas of Southern Italy.
Introduced to mitigate the negative effects of the Covid-19 pandemic, this facility is aimed at supporting companies that operate in
difficult socio-economic environments.
Extension and Regulatory Process
The measure, initially introduced with the August Decree (Decree-Law no. 104 of 14 August 2020), was subsequently extended by the 2021 Budget Law (Law no. 178 of 30 December 2020), extending the tax exemption until 31 December 2029. Relief rates are set
at:
- 30% up to 31 December 2025
- 20% for the years 2026 and 2027
The recent extension, announced on 25 June 2024 by the Ministry of Labor and Social Policies, extends the operation of the measure until 31 December 2024.
Who is entitled to
The Southern Decontribution is intended for private sector employers, including non-entrepreneurs, with registered office or operating units located in the following regions:
- Abruzzo
- Basilicata
- Calabria
- Campania
- Molise
- Apulia
- Sardinia
Companies with operating units in these regions can benefit from the benefit, provided that the authorization code “0L” is inserted in the contribution characteristics of the company registration.
Requirements
To benefit from the Southern Decontribution, employers must:
- Be in compliance with contribution obligations (DURC)
- Do not have violations of the rules for the protection of working conditions
Excluded
The following cannot benefit from the measure:
- Employers in the agricultural and domestic sector
- Economic public bodies and autonomous institutions, public housing
- Special companies and industrial consortia
- Moral and Ecclesiastical Institutions
- Companies operating in the financial sector and subject to EU sanctions
South 2024 Decontribution Calculation
The benefit corresponds to a reduction from 30% to 10% on the social security contributions due, excluding INAIL premiums and contributions:
- 30% up to 31 December 2025
- 20% for the years 2026 and 2027
The disbursement ceiling is set at:
- 300,000 euros for companies in the fishing and aquaculture sectors
- 2 million euros for other eligible companies
Calculation Example
If an employer must pay INPS contributions of 100 euros, with a 30% relief, the cost is reduced to 70 euros (30% discount). INAIL contributions are excluded
.
How to Apply for the Southern Decontribution
Employers must expose workers entitled to relief in the Uniemens flow. The specific methods of exposure are detailed in the INPS Circular n. 90 of 27-07-2022
.
