Italy's 2027 Budget Introduces Tax Incentives for Contract Renewals

The Italian government has launched the first phase of its 2027 budget (Manovra 2027). Labour Minister Marina Calderone presented measures that keep a reduced 5% tax rate on contract renewals and apply a 1% rate on bonuses up to €5,000. The average annual bonus for the more than 3.8 million workers covered by productivity contracts rose to about €1,800, with the incentive aimed at encouraging new agreements and wage growth.

Vice‑minister of Economy Maurizio Leo announced a package of 29 fiscal measures, including a two‑year pre‑payment scheme that lets self‑employed professionals calculate their taxes in advance based on revenue‑office data. A separate initiative offers municipalities the option to waive local taxes, fines and arrears for taxpayers who join the programme; roughly 1,000 municipalities have already signed up, with the government hoping to expand the offer to the remaining 7,000. The package also highlights the results of the anti‑evasion drive, which has collected over €36 billion this year and more than €100 billion since the start of the legislature.