Starting January 1, the Italian tax system will change for at least a year. The government gave the green light today, Thursday, December 28, to the expected reduction in Irpef rates from 4 to 3. Thus, the first rate of 23% will also cover the existing second tranche between 15 thousand and 28 thousand euros. .
Indeed, the Council of Ministers more precisely approved four decree laws implementing the Fiscal Board. These are 4 provisions related to: collaborative compliance, tax cases, taxpayer law and the Irpef reform module mentioned above.
Extra money in Italians’ pockets in 2024
According to the government’s intention, this is a first step that will be especially advantageous for middle-low income earners. “Underlining the resources of Palazzo Chigi, the Government is moving quickly on the implementation of the Delegation and will close 2023 by respecting all the targets it has set. The financial revolution that Italy has been waiting for for more than 50 years will be completed in 2024” “.
How does Irpef change?
The text is substantially the same as the text approved in the preliminary review. Irpef brackets reduced to three (from four). In the first bracket (up to 28 thousand euros) a rate of 23 percent is applied, between 28 thousand and 50 thousand euros the rate remains at 35 percent, a similar situation exists for incomes above 50 thousand euros and this rate will remain the same at 43%. . According to the government’s intention, it is a measure that is expected to provide advantages especially to taxpayers in the middle income group.
The biggest savings will be felt in the income range between 30 thousand and 50 thousand euros, with an annual tax saving of 260 euros. The Irpef decree also increases the deduction for employed work from 1,880 euros to 1,955 euros for next year, setting the tax-free area at 8,500 euros.
Rates in effect today
- 23% up to 15 thousand euros
- 25% between 15 thousand and 28 thousand euros
- 35% between 28 thousand and 50 thousand euros
- 43% over 50 thousand euros
Rates from 2024
- 23% up to 28 thousand euros
- 35% between 28 thousand and 50 thousand euros
- 43% over 50 thousand euros
Combining the first two rates would cost around 4.1 billion euros, according to government estimates. A worker or retiree with a gross income of 20 thousand euros needs to save 100 euros a year, so just over 8 euros a month. For those with an income of 25 thousand euros, the tax advantage will be 200 euros per year (just under 17 euros per month), and for incomes above 28 thousand euros, it will be 260 euros.
“Today, the Council of Ministers approved four more definitive decree laws in addition to last week’s two: cooperative harmonization, tax cases, taxpayers’ law and the first module of the Irpef reform, which reduces the brackets from 4 to 3. These are very important. Economy and Finance Deputy Minister Maurizio Leo states that important measures have been taken that will contribute to simplifying the tax system, making it more fair and dynamic, and adds: First of all, by simplifying the framework for Irpef rates, more tax savings are achieved for middle-low income groups, that is, international economic- those most exposed to constant changes in the financial framework”.
Source: Today IT
Emma Fitzgerald is an accomplished political journalist and author at The Nation View. With a background in political science and international relations, she has a deep understanding of the political landscape and the forces that shape it.
