Tax breaks up to 5.2 bln euros
Next year’s budget provides for tax breaks amounting to 4.2 billion euros, which may reach up to €5.2 billion depending on developments on energy and inflation.
Some of the measures are permanent, while others will be implemented only to deal with the energy crisis and save energy. The permanent abolition of the solidarity levy, the maintenance of reduced insurance contributions and the maintenance of low VAT rates are the measures that will cost the most in the next year’s budget, while others of lesser budgetary cost are included, such as the “Renovate/Save” program for young people, which amounts to €350 million. The planned tax and social security interventions for 2023 concern:
• The permanent abolition of the payment of the solidarity levy by public servants, pensioners and the private sector from 2023, with the aim of increasing their real income (annual fiscal cost of €1.24 billion).
• Maintaining on a permanent basis the reduction by three percentage points of private sector employees’ insurance contributions (annual budgetary cost of €871 million).
• The extension into 2023 of the VAT reduction on passenger transport services, non-alcoholic drinks and beverages distribution services, cinema, theater and concert tickets, gymnasiums and dance schools and the tourism package (€246 million).
• The VAT suspension on new buildings until end-2024 (€18 million).
• Subsidizing the installation of photovoltaic panels for households, businesses and agricultural holdings to save energy (€700 million euros for 2023) and expanding the application of the “Recycle/Change” program (€140 million).
• The introduction of the “Renovate/Save” and “Renovate/Rent” programs to address increased housing costs for young people (€350 million).
• The reform of the special salary of the National Health Service doctors and the salary interventions to support the executives of the Armed Forces (€103 million).
• The provision of incentives for the extension of the tourism season also during the winter season, mainly through the extension of the “Tourism for All” program, with a budgetary cost of €31 million for 2022 and €20 million for 2023.
