Translated automatically by AI from the Italian original.
ROME – The 2027 economic budget has passed scrutiny by the State General Accounting Department. The text, made up of 157 articles and worth a total of around €26 billion, has been sent by the Economy Ministry to the Council of Ministers’ office, ready to be forwarded to the Quirinale and then examined by Parliament.
Despite approval by the Council of Ministers on 30 October 2026 and the Treasury’s certification, it is crucial for citizens to understand that this is not yet the final text and, above all, that the announced measures – from income tax discounts to exemptions – are not universal but tied to precise income thresholds, technical features and time limits. As with foreign dossiers on environmental investigations or constitutional safeguards[cite: 6, 7], distinguishing between principle and real-world application is essential to avoid false expectations.
Income tax: the benefit depends on the portion above €50,000
The change to personal income tax does not involve applying a 33% rate to the entire income, but extending the second bracket: the 33% rate would replace the 43% rate only on the portion of income between €50,000 and €55,000. This ten-point difference is what determines the tax saving:
- Income up to €50,000: No additional benefit from this specific measure.
- Income of €51,000: Annual gross income tax reduction of €100.
- Income of €53,000: Reduction of €300.
- Income from €55,000 upwards: Maximum annual benefit of €500.
The reference is to the taxable income, not the gross annual salary, a crucial distinction for calculating the actual net pay.
Car tax: structural exemption, but not for all vehicles
The budget aims to make the vehicle tax exemption permanent, but within strict limits also defined by decree no. 162 of 17 September 2026 and ACI guides:
- Power: Reserved for cars and vehicles up to 80 kW and motorcycles.
- Vehicle: The benefit applies to only one vehicle per individual.
- Deadlines: ACI clarifies that payments due by 2026 must be made even if they cover periods in 2027; paying in 2027 does not turn a past debt into an exempt payment.
Rentals: reduced withholding tax only for new contracts
Important news for the property sector, but limited to new agreed-rent contracts signed from 2027:
- Standard agreed rate: Would fall from 10% to 5%.
- Young people’s rate: Reduction to 1% if the tenant is under 36 at the time of signing.
- Shops: Withholding tax at 21% for new 2027 contracts on commercial properties up to 200 m² (10% in metropolitan city capitals).
The text introduces strict anti-avoidance limits: the relief does not apply if, between the same parties and for the same property, there was an unexpired contract in place on 30 September that was terminated early. Date, rent and the property’s contract history therefore matter.
Tobin Tax and pensions: increases and funds to be defined
The bill also provides for interventions on revenue and funding, including:
- Tobin Tax: Doubling from 0.4% to 0.8% on the value of affected transactions and an increase for high-frequency trading.
- Pensions: Establishment of a fund worth €850 million a year for the three-year period 2027–2029 to support early retirement. The specific measures are deferred to subsequent legislation.
