Tax reform: who really benefits and how much you save
Giuseppe Ripa*
05 October 2023, 14.46
The tax reform became law on 4 August 2023 and envisages a gradual reduction of the personal income tax (Irpef) from 1 January 2024, initially by reducing it from 4 to 3. One of the government’s priorities is to consolidate the first two Irpef tranches. It is 23% (up to 15,000 at 23% and those between 15,000 and 28,000 at rates up to 25%), with the tax wedge deduction being extended to the whole of 2024.
Cut in blackouts
The problem will be finding the sources and that is why we need to look at Nadef (Def, Economics and Finance Paper Update note). Resources will not come from the “Tax Expenditures” Reform; Deputy Minister of Economy Maurizio Leo said, “We can save a maximum of $1 billion with surgical intervention.”
The cost to the state in tax deductions and cuts of various kinds is equal to 4% of Italian GDP. These tax cuts are 626 and are worth 83 billion annually. The increase in tax rates from 4 to 3 affects approximately 23 million employees and 16.1 million retirees. Below is the table showing the taxes that taxpayers will pay according to the default 3-rate system in 2024 and the current rules in 2023.
Examples of gross annual income in the range of 14,000 to 50,000 euros.
This is a hypothesis regarding the revision of Irpef rates, which will increase from the current 4 to 3 at a cost of about 5 billion to the State.
* Giuseppe Ripa is an author and former director of the Internal Revenue Service
Source: Today IT

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