The Council of Ministers approved the bill enabling the tax reform and thus started a process that within 24 months should lead to the approval of implementing decrees to change the tax system. The most significant change is the change from 4 to 3 IRS rates, the declared political objectives are the reduction of the tax burden on workers’ income and the introduction of the possibility of joining the single taxation regime for all. The reform, says the MEF, “rewrites the current tax system launched in the 1970s” and guarantees “horizontal equity, through the reduction of the tax burden, changing from 4 to 3 rates and with the objective of a single tax for all”. The text was designed to simplify and reduce the tax burden, encourage investment and hiring and establish a relationship between taxpayers and financial administration in a logic of dialogue between the parties based on the needs of citizens and companies. The text also aims to ensure the rationalization and simplification of the entire Irpef system (Agricultural, Building, Financial, Employment, Autonomous, Business and Miscellaneous Income).
“With the new tax system, we have outlined a new idea of Italy, close to taxpayers’ needs and attractive to companies”, says Prime Minister Giorgia Meloni. «The reform contains a global and programmatic vision – he continues – that rewards the taxpayer’s loyalty and responsibility, laying the foundations for a new relationship of trust with the Tax Administration. Thanks to the reform of the tax system, we are lowering taxes, increasing growth and equity, promoting employment and investment”. The three rates of personal income tax “we will start from next year”, specifies the deputy minister of Economy, Maurizio Leo. «I would be cautious with the numbers because the qualification law – he continues – does not dictate precise numbers. The implementing decrees will then identify them, as well as the resources, without budget slippage”. As of January 2024, however, a reform module will come into effect: “We will find the necessary resources and coverage. We indicate the priorities and we will fulfill them».
The delegation also foresees the revision of the tax expenses, (today more than 600 items) and the equalization of the non-tax area for employees (8,174 euros and pensioners 8,500 euros). For companies, a reduction in the current IRES rate is foreseen for those who invest and/or hire. The provision also provides for the gradual elimination of IRAP, the regional tax on productive activities. With the establishment of the biennial concordat with creditors and the strengthening of collaborative compliance, the rules for combating tax evasion also change, which in the intentions of the MEF becomes preventive and no longer repressive. In the minutes circulated in recent days there was also talk of a possible rationalization of the number of VAT rates to make it more homogeneous with EU criteria. Among the numerous points, the delegation also envisages a new tax system for Municipalities, Provinces and Metropolitan Cities through a reorganization of local taxes and the simplification of obligations.
Source: IL Tempo
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