Time is running out and the deadlines are already set on the calendar. By Friday 2 October the Meloni government must present and transmit to the Chambers the public finance planning document (DPFP) which replaced the old Nadef. It is the Italian budget document as part of the new economic planning cycle adapted to European rules: in short, it defines the economic and financial policies decided by the government.
Then, by mid-month, the government must present and send the draft budget plan (Dpb) to the European Commission. Subsequently, by October 20, the Council of Ministers must approve the budget bill and send it to Parliament, which thus opens the budget session. The final date, however, remains 31 December 2026, the maximum limit for approval.
The two priorities and spending constraints
Having said this, what does the Meloni government want or would like to do? It is clear that at the moment we are talking about hypotheses being studied, and that everything will then depend on the actual costs of the measures and on finding the financial resources necessary to implement them. However, something concrete is already there, at least in intentions. There are essentially two priorities for the next budget: a tax cut for the middle class and an intervention on salaries.
This was reiterated in recent days by the Minister of Economy, Giancarlo Giorgetti, even after the definitive data from Istat confirmed a 2025 deficit/GDP ratio of 3.1%, too high for Italy to exit the European Union infringement procedure early. Which translated means that the government will not have much spending margin for the next budget, due to the much tighter economic policy constraints. However, Giorgetti assured that he wanted to “keep the accounts and growth together”. The summary on the maneuver will take place “shortly”, he added, because first of all the public finance framework will have to be updated. “At the beginning of next month, the strategic and political indications from the government will be clarified”, anticipated the minister.
The hypothesis of the reduction of Irpef
Salaries are at the center of the reasoning for the next budget law: in last year’s budget law, the salary package already included various benefits which will expire at the end of the year and which, therefore, require new allocations to be confirmed. “Several times the government has reiterated the priorities regarding the continuation of the process of reducing income taxes for the middle class”, said Giorgetti, responding to the question time in the Chamber and confirming that the revision of the Irpef bracket “is one of the objectives”. “Naturally these are choices that will have to converge in a synthesis”, he however underlined.
The reduction in Irpef, therefore, should also concern the middle class, with an indirect reference to the bracket between 50 and 60 thousand euros. The majority’s objective is to bring the income range between 50 and 60 thousand euros gross into the second Irpef bracket, applying a rate of 33% and no more than 43%, explained the Deputy Minister of Economy, Maurizio Leo, in recent days.
“We have intervened over time, during this legislature, first of all to move the rate mechanism from four to three and then, with last year’s budget law, the rate of 35%, therefore the one that embraces the space from 28 to 50 thousand euros, we brought it to 33% – explained Leo -. What is the further step we want to work on, compatibly with the resources and with the sharing by all the members of our majority? Obviously, taking into account that this aspect has already been requested by many, it is to embrace the range from 50 to 60 thousand euros and bring it back into the second bracket, therefore applying 33% to this income range instead of 43%.
At the time of writing there are no further details on this hypothesis: the ministry’s technicians are working to put it in black and white, defining concrete costs and coverage.
There are discounts expiring
What is certain is that among the benefits expiring on salaries there is the supplementary treatment for night work and overtime on public holidays, recognized for male and female tourism workers. Expires Wednesday 30 September: the measure has been reconfirmed several times in recent years and now a reprogramming is needed for 2027. Furthermore, this year a flat tax of 15% has also been envisaged on shift allowances and wages for work carried out at night or on holidays up to a maximum of 1,500 euros. A measure that entails a cost, in terms of lower revenue, of 534.8 million euros in one year.
The salaries of young people, thirteenths and the self-employed
There are other promises made in recent months regarding salaries, such as the tax relief on thirteenth wages and that of a lighter tax rate for young workers. At least according to what has emerged so far, in the first case the aim is for a substitute tax of 15% (or 10%) for those with incomes of up to 15 thousand euros, guaranteeing a net saving in the paycheck of between 200 and 500 euros. And the hypothesis is that of a selective intervention worth 500 million euros.
In the second case, the intervention proposals presented last year in Parliament start from a minimum of 200 million euros. Giorgetti spoke of a tax break on salary increases for young workers, to encourage the growth of wages below a certain age, through more favorable taxation on increases recognized by companies. “I remember the great success that the government’s initiative had last year to recognize a 5% flat tax on contractual increases – argued the minister -. I think that this success can be transferred, with the necessary precautions, also to any salary increases granted to young people in companies”.
What about self-employed workers? The next maneuver could include raising the threshold to 100 thousand euros (from 85 thousand) for the application of the flat tax (to 15%, or 5% for new activities). Meanwhile, Forza Italia has proposed raising the maximum employee income allowed to open a VAT number by adhering to the flat-rate regime from 35 to 40 thousand euros.
Resource hunting
We said it at the beginning, we say it again at the end. The theme, as always, is that of financial coverage. According to data from the Parliamentary Budget Office (UPB), the flat tax that the Meloni government hypothesizes would weigh 420 million euros, and is just one of the many measures to be confirmed to ensure that paychecks are not penalized. This government must also keep its recent promise on the elimination of car tax for some cars: for just one year, 2027, it will cost as much as 2.3 billion euros. We will have to deal with reality.