Italy’s parliament passes a modest 2026 budget, featuring tax cuts and bank contributions, aiming for a 2.8% deficit amid slow growth forecasts.
MILAN: Italy’s parliament has approved a modest budget for 2026 following weeks of negotiations.
Prime Minister Giorgia Meloni described the “serious and responsible” budget as focusing “limited resources” on families, employment, businesses and healthcare.
The measures include tax cuts worth EUR 9 billion over three years, notably for those earning between EUR 28,000 and EUR 50,000 annually.
The average gross salary in Italy was just over EUR 37,000 a year in 2022, according to national statistics.
Opposition leader Elly Schlein criticised it as a “flawed budget of austerity” that “helps the richest the most” and fails to promote growth.
Meloni’s government has helped stabilise the eurozone’s third-largest economy during its three years in office.
However, Italians face a rising cost of living, with growth forecast at a sluggish 0.7% of GDP in 2026.
Italy remains heavily indebted, but the government aims to bring the deficit to 2.8% in 2026, within the EU’s ceiling.
This is partly possible due to funds from the EU’s post-Covid recovery plan, from which Italy has received EUR 153.2 billion so far.
The budget also steps up contributions from banks and insurance companies, with measures worth EUR 11 billion by 2028.
It includes higher taxes on diesel and cigarettes.
