Cut income tax for the middle class yes, but gradually. In two phases. First by extending the 33% rate in 2027 for those earning up to 55 thousand euros in annual income, and then reaching 60 thousand euros in 2028. This is the government’s hypothesis. And on the other hand, a two-stage intervention would make it possible to contain the impact of the measure on public finances, estimated at around 3.5 billion euros in total, while the first cut on taxes would cost around 1.5 billion.
The “concrete” hypothesis, but…
This perspective was confirmed by Antonio Tajani, deputy prime minister and leader of Forza Italia, who during an internal party meeting dedicated to the budget law defined the extension of the rate to 33% for incomes up to 55 thousand euros as “a concrete hypothesis”, with the postponement of the threshold of 60 thousand euros to the following year. The measure could involve around three million taxpayers with a medium-high income. While waiting for the Council of Ministers next Tuesday (27 October), where concrete answers could arrive on this very hypothesis, it is clear that its actual implementation will depend on the financial resources available and also on the outcome of the negotiations with Brussels on budget flexibility.
Who earns more
The fact is that for 2026 the Irpef brackets and rates are organized into three income brackets:
- up to 28 thousand euros: rate of 23%;
- over 28 thousand euros and up to 50 thousand euros: rate at 33% (reduced compared to the previous 35%);
- over 50 thousand euros: rate at 43%.
Let’s do the math. Who would earn more with the 33% rate up to 55 thousand and then 60 thousand euros of income? In the hypothesis being studied by the government, the saving on taxes would obviously derive from the reduction from 43% to 33% of the taxes due on the part of the taxable amount affected by the change. And therefore: with the limit moved to 55 thousand euros, the maximum discount would be 500 euros gross per year. From 2028, however, the maximum benefit would rise to one thousand euros with the extension of the income range up to 60 thousand euros.
All amounts
Nothing new for those with an income of 50 thousand euros: the reform only concerns the part of the income that exceeds this threshold. Those who earn more, however, would have an increasing saving based on the share affected by the rate cut from 43% to 33%. In essence, if the reform hypothesis were to be confirmed in the economic budget, every thousand euros of income that goes from 43% to 33% are worth 100 euros of tax savings (based on the difference of ten percentage points between the two income rates). In concrete terms, making estimates on the gross income tax and without considering the regional and municipal deductions and additional taxes, we would have this situation:
- taxable income of 51 thousand euros: since the portion exceeding 50 thousand is one thousand euros, with the rate of 33% instead of 43% the savings would be 100 euros per year, both in 2027 and 2028;
- with an income of 52 thousand euros and a surplus of two thousand euros, the benefit would be 200 euros per year;
- with an income of 53 thousand euros the savings would be 300 euros per year;
- with 54 thousand euros you would save 400 euros;
- in the case of the first limit of 55 thousand euros of income, however: the 5 thousand euros between 50 thousand and 55 thousand would have the entire rate reduction, with a discount of 500 euros per year, both in 2027 and 2028;
- and who has an income of 56 thousand euros? In 2027 the savings would remain at 500 euros, but from 2028 it would rise to 600 euros, because another 100 euros would be added to the initial benefit, thanks to the cut applied (again in theory) also to the thousand euros between 55 thousand and 56 thousand;
- and so on, with the rate of 33% up to 60 thousand euros of income in 2028: 700 euros per year would be saved for those with an income of 57 thousand euros (from 500 in 2027), 800 euros with 58 thousand euros (always rising from 500 euros per year in 2027), 900 euros for those who declare 59 thousand euros;
- with 60 thousand euros of income you would have the maximum discount: one thousand euros from 2028.
The roofing knot
The search for a balance between the promised interventions and the available financial resources remains at the center of the work of the Prime Minister, Giorgia Meloni, and the Minister of Economy, Giancarlo Giorgetti. Reducing middle class income taxes, even if gradually, has always been a priority of this executive, at least in words. However, the public finance framework remains a constraint on government decisions.
Istat has confirmed for 2025 a deficit equal to 3.1% of gross domestic product (GDP) and a debt-to-GDP ratio of 136.7%. In this context, a precise date for the presentation of the budget bill has not yet been indicated, also pending the developments of the discussion with the European Union on the flexibility of public finances.