A year ago, the Italian Prime Minister, Giorgia Meloni, surprised by betting on prudence when approving her first budgets as president. But this time things have changed. This Monday, Meloni approved a budget package for 2024 with a cost of 24 billion that includes aid and a significant tax reduction that could set off alarm bells in Brussels. The Government's latest forecasts indicate that the budget deficit will increase next year to 4.3% of GDP, partly due to the €15.7 billion of additional debt to cover these tax cuts, and which has not been liked at all. to the markets.
“It is a very serious and very realistic budget and it does not waste resources, but rather concentrates them on the great priorities that follow the vision that the Government has given since the beginning of its mandate,” defended the premier during a press conference.
The Italian Government's intention is to combat inflation with a cut in the tax wedge – the percentage of labor income that is used to pay taxes on labor and contributions – which, according to Meloni, will translate into a salary increase of one average of about 100 euros per month for 14 million Italian workers. It will be six percentage points for those who earn up to 35,000 euros a year and seven for salaries of up to 25,000. The Italian budgets also include the merger of the first two brackets of the income tax for individuals to one of 23%. Therefore, it will be 23% up to 28,000 euros, 35% up to 50,000 and 43% for more than 50,000 euros. This is, according to the Minister of Economy, Giancarlo Giorgetti, the first step towards a single tax, one of the main electoral promises of the right-wing coalition.
In addition, Italy will also allocate 7 billion to renew contracts in the public sector and increase salaries, of which 2,000 will go directly to health personnel. Health will also receive another 3 billion next year with measures focused on reducing waiting lists.
Meloni wanted to focus on one of his great concerns, the demographic crisis facing Italy, since last year births were once again the lowest since the country's unification in 1861. Around one billion euros will go to promoting birth rate with measures such as free daycare starting with the second child or that mothers with at least two children do not pay social contributions for workers, which will be assumed by the State.
Likewise, Italian law includes provisions for the construction of large works such as the bridge to join Sicily and Calabria in the Strait of Messina. Meanwhile, Giorgetti advanced “an ambitious privatization program” that should bring in some 20 billion euros before 2026, starting with selling the share of Ita Airways, the airline born from the ashes of the former Alitalia, to Lufthansa. Rome has further confirmed that the global minimum tax of 15% for multinationals with an annual turnover of more than €750 million will come into force from January 1, 2024.
