Italy considers Irpef tax cut for middle-class incomes up to 60,000 euros

The Italian government is preparing its upcoming budget maneuver with a focus on reducing the tax burden for the middle class. A primary proposal involves extending the 33% Irpef tax bracket to include incomes up to 60,000 euros, up from the current 50,000 euro threshold. This change would move taxpayers out of the 43% bracket, potentially offering annual savings of up to 1,000 euros for those earning 60,000 euros.

While the exact implementation remains under study, the move is intended to benefit approximately one million taxpayers directly, though the progressive nature of the tax system could affect up to 3.3 million people if the benefit is not capped at higher income levels. Prime Minister Giorgia Meloni has emphasized the goal of rewarding the middle class, which has been impacted by inflation and fiscal drag.

The estimated cost of this tax cut is approximately 2.7 billion euros. To cover these expenses, discussions include potential new levies on banks and insurance companies. Deputy Prime Minister Matteo Salvini has suggested a 5% contribution from these sectors, which could generate at least 1.5 billion euros annually.