Italy Italian parliament adopts 2025 budget
Shortly before the turn of the year, the Italian parliament finally approved the 2025 budget. The financial package of the right-wing three-party coalition of Prime Minister Giorgia Meloni with a total volume of 30 billion euros was also approved by the upper house of parliament in Rome, the Senate. The Chamber of Deputies had already given its approval shortly before Christmas.
28.12.2024, 15:07
SDA
The budget provides for a reduction in Italy's new public debt to 3.3 percent of gross domestic product (GDP) for the coming year. This year, it will probably still be at 3.8 percent. According to the European stability criteria, only 3.0 percent is actually permitted. Italy is already one of the most indebted countries in the world.
Below the three percent mark by 2026
The EU has repeatedly called on Rome to finally start reducing its deficit after enormous overspending in previous years. The Meloni government has at least pledged to bring new debt below the three percent mark by 2026. Whether this can be achieved is uncertain.
The plans are complicated by costly state subsidies for energy-saving construction, the so-called super bonus. In addition, the national statistics authority recently dampened the growth prospects. Italy is now expected to grow by 0.5 percent this year - only half as much as in the summer.
Tax relief for low earners
Nevertheless, according to the budget that has now been adopted, there will be tax relief for low earners. Those earning less than 28,000 euros per year will pay 23% income tax instead of 25%.
With a bonus for parents, the Meloni government wants to increase the birth rate, which has been one of Italy's problems for decades: Families with an annual income of less than 40,000 euros will receive 1,000 euros for having children. This is also to be financed by a contribution from the Italian banking sector. In recent weeks, Italy's trade unions have repeatedly mobilized against the budget with strikes because they consider it to be socially unjust.
Italy has been governed by a right-wing three-party coalition since the fall of 2022. The largest governing party is Meloni's Fratelli d'Italia (Brothers of Italy), while the two smaller partners are the right-wing Lega and the conservative Forza Italia.
