Italy issues guidance on biennial tax settlement and fiscal outlook

The Italian Revenue Agency has released circular no. 8/E, providing a systematic reconstruction of the biennial preventive settlement (CPB) rules. This instrument allows taxpayers to propose a predetermined taxable income for two tax periods. The new guidance incorporates updates from the Omnibus decree and aims to standardize application across financial offices for businesses and self-employed workers.

For the 2026-2027 period, the deadline for adhesion is November 2, 2026. Notably, taxpayers with tax or social security debts exceeding 5,000 euros—including interest and penalties—as of December 31, 2025, risk exclusion from the settlement.

Separately, discussions regarding Italy’s Programmatic Document of Public Finance (DPFP) have highlighted economic concerns. While INPS reports a historic peak of 27.2 million insured individuals in 2025, analysts have raised questions regarding the quality of employment, specifically the high number of VAT-registered workers and the potential prevalence of precarious self-employment masking dependent labor.