European Commission opens door to using PNRR savings for Italy's car tax cut
The European Commissioner for Economy, Valdis Dombrovskis, has confirmed that Italy's National Recovery and Resilience Plan operates on results rather than costs, creating room for the government to use savings from the programme to fund the suspension of the annual car tax. Speaking in Dublin, Dombrovskis explained that payment flows from Brussels need not align perfectly with what member states spend, acknowledging "a certain margin in terms of liquidity management." Italy's Economy Minister Giancarlo Giorgetti had argued that savings on PNRR loans amount to "national money" since the state repays them regardless — a reading Brussels did not endorse directly, but did not reject either.
Deficit decision looms for Italy ahead of Eurostat ruling
All eyes now turn to Tuesday, when Italy's National Institute of Statistics releases its definitive deficit figures for 2025. The current estimate stands at 3.1% of GDP, just above the EU's threshold. If the final number falls below 3%, and Eurostat confirms this on 21 October, Italy would exit the excessive deficit procedure opened in July 2024. Economy Minister Giorgetti, speaking Friday in Dublin, said he was "hopeful."
Exiting the procedure would restore Italy to the ordinary arm of the Stability Pact, unlocking practical advantages. The country could then apply the National Escape Clause for defence and energy security spending with greater flexibility. Italy has formally requested to activate this clause for about €36 billion total through 2028, including €14 billion earmarked for energy security measures. Staying within the normal framework would also improve Italy's credibility with financial markets at a time of heightened tension on some sovereign bonds in the eurozone.
National Escape Clause for energy clears technical review
The request to extend the National Escape Clause to energy security appears on track. According to sources in Brussels, the spending list Rome submitted matches the intervention categories agreed by the EU27 alongside the European Commission and European Central Bank. Experts are still conducting technical checks, but rejection appears highly unlikely. Formal approval could arrive at the EU Economic and Financial Affairs Council meeting on 9 October. Environment Minister Gilberto Pichetto Fratin confirmed the €14 billion in planned spending aligns with EU guidelines, covering interventions on both public and private buildings.
Property sector pushes for commercial rent flat tax in budget
Confedilizia, the Italian property owners' federation, has renewed its call to extend the flat-rate tax regime known as cedolare secca to non-residential properties. The measure would apply a 21% flat tax on new rental contracts for shops and commercial premises. The government's Deputy Economy Minister Maurizio Leo has already included the proposal among the budget's objectives. The scheme would resurrect a 2019 provision, though the size threshold could drop from 600 square metres to between 250 and 300.
Minister for European Affairs Tommaso Foti said the government awaits Tuesday's definitive deficit data before determining the scope of available resources. He pledged to fight the draft EU Affordable Housing Act, which would impose restrictions on short-term rentals in areas where house prices exceed eight times annual disposable income per capita. "The housing problem is not short-term rentals," Foti argued, promising to request a national exemption clause. Deputy Prime Minister Matteo Salvini went further: "Housing is off-limits. Private property is sacred."
Trade union opposes expanding flat tax for self-employed
The secretary general of Italy's CISL trade union, Daniela Fumarola, has attacked a League party proposal to extend the flat tax regime to self-employed workers earning over €100,000. She called the idea "inequitable and a slap in the face of fairness and cohesion," noting that employees and pensioners pay more than double the tax while earning less than half as much. Fumarola called instead for extending income tax reductions to the middle class by raising the threshold for the top tax rate to €60,000, and for de-taxing the thirteenth monthly salary while confirming tax breaks for productivity bonuses.
Charging point subsidies open for applications
Italy's Ministry of Enterprises and Made in Italy will begin accepting applications for electric vehicle charging infrastructure subsidies from noon on Tuesday, 22 September. The bonus covers 80% of purchase and installation costs, up to €1,500 for individuals installing private charging points. The ceiling rises to €8,000 for work on condominium common areas. The programme, managed through the Invitalia platform, has a total allocation of €68 million through 2030. "Every euro invested in the charging network supports Italian manufacturing, employment and our technology supply chains," said Minister Adolfo Urso.
Agriculture sector receives targeted support measures
The Ministry of Agriculture has activated more than €136 million to compensate farmers for fertiliser price hikes caused by the Middle East crisis. The measure combines €45 million from the EU Agricultural Reserve with €91 million in national funds, covering 50% of cost increases for crops with high fertiliser needs including wheat, rice, maize and olive oil. Over 547,000 farmers will receive automatic payments without additional paperwork.
Separately, the ministry launched a €40 million zero-interest loan programme for olive oil mills through ISMEA, the public agricultural finance institute. Loans range from €3,500 to €50,000 over five years, with two years of pre-amortisation before repayment begins. ISMEA also extended the deadline to 15 December 2026 for applications to a €10 million fund for modernising agricultural tractors, in partnership with INAIL.
Government works on early retirement at 64
The Undersecretary for Labour, Claudio Durigon, outlined a three-year measure allowing retirement at age 64 for workers willing to have their pension calculated entirely on contributions paid. The proposal would lower or eliminate the minimum pension threshold currently set at €1,638.72 gross per month. Durigon said this could help unemployed workers and fragile categories currently excluded by the three-times-social-pension minimum requirement. The measure could affect 80,000 pensioners in the first year, rising to 180,000 over three years, at an estimated cost of over €1.6 billion annually.
INPS president Gabriele Fava noted that the number of workers over 55 has grown 65% in six years, reflecting stricter pension rules and demographic changes. "Living longer does not automatically mean being able to work longer," he cautioned. "Not all jobs wear people down in the same way."
Technology and innovation receive €140 million boost
The Ministry of Enterprises has allocated €140.2 million from the 2014-2020 Development and Cohesion Plan for technology and digital infrastructure. The largest share — €87.7 million in additional funds — goes to Innovation Agreements to process applications already under review. Another €30 million targets quantum technology, bio-electronics and advanced pharmaceuticals, while €17.5 million from 2027 will fund electronic communications and radio spectrum management programmes.
Industrial leaders call for directing savings into productive investment
Confindustria's vice president for credit, finance and taxation, Angelo Camilli, said the 2027 Budget Bill should help convert private and pension savings into productive investments. He estimated that channeling 1% of family bank deposits and 2.5% of pension fund resources into the domestic economy would unlock roughly €25 billion per year — equivalent to a full budget bill.
