Italy pension reforms: potential 64-year exit and 2027 benefit reductions

The Italian government is considering new pension flexibility measures in its upcoming budget. Undersecretary for Labor Claudio Durigon stated that the administration is working toward a right for workers to retire at 64 to encourage generational turnover. He also proposed lowering pension taxation from 20% to between 12% and 13%, similar to the French model, and reducing youth taxation to 5% during their first years of work.

However, automatic adjustments based on life expectancy will impact benefits starting January 1, 2027. New transformation coefficients will reduce the monthly pension amount for those under the contributory system. For example, the coefficient for a 67-year-old will drop from 5.608% to 5.514%. Additionally, the retirement age for old-age pensions is set to rise gradually to 67 years and one month in 2027.

Labor union Cgil has released simulations suggesting significant long-term financial impacts. According to the union, the cumulative loss over a lifetime of retirement could exceed 35,000 euros for some individuals due to the combined effect of the 2025 and 2027 coefficient revisions.