Italy tax reform faces scrutiny amid slow revenue collection

Italy is undergoing significant fiscal changes following the Meloni government's tax reform. The reform, which includes new consolidated texts on income tax and assessment measures introduced via Decree Law n. 38 of 2026, aims to simplify the system and support the middle class. However, critics point to a disparity in how tax advantages are distributed, noting that employees and pensioners face automatic withholdings, whereas other groups may have more flexibility in managing their tax liabilities.

Simultaneously, data from the Department of Finance reveals challenges in tax recovery. The Agenzia delle Entrate Riscossione currently takes an average of 5.1 years to collect a tax bill, a slight increase from 4.8 years in 2024. While the percentage of taxpayers paying immediately after notification rose to 21.54% in 2025, the overall recovery rate for new charges remains low at approximately 2.07%.