Italy rolls out 5% flat tax for young workers and salary bonuses

Regional Lega leader Orlandino Greco praised the Italian government's proposal, announced by under‑secretary Claudio Durigon, to introduce a 5 % flat tax for young people. Greco said the measure should help retain talent, boost household income and make the South a priority for development, adding that lower taxes could encourage work, investment and family formation in the Mezzogiorno.

The Treasury's 2026 budget law also created a flat‑tax incentive on wage increases and bonuses. A circular from the Agenzia delle Entrate explains that employees earning up to €33,000 will have contract‑renewal salary increases taxed at 5 %, while those earning up to €40,000 receive a 15 % rate on night‑shift, holiday and turn‑over allowances, capped at €1,500 annually. The guidance confirms that the reduced rates apply retroactively to arrears and to special tax regimes, but exclude one‑off payments.