Minister Moodys, after years of failures that took Italy one step away from junk bonds, promoted the country by recognizing the benefits of controlling public finances. What does this renewed market confidence mean and what impact will it have?
«Moody’s decision, along with the other 3 rating agencies, is an important signal. As President Meloni well stated, this recognition is a tribute to the serious and responsible work of our government, the result of sensible choices and structural reforms, but also the work and commitment of our companies and workers. Italy wins as a country system. It is clear for us that this is not an end point, but a strengthening of our reliability in international markets, which means lower debt issuance costs.”
Reducing interest differences, saving on debt interest, could open up a more accommodative fiscal policy in the near future. I say differently, after Irpef cuts for the middle class, what are the next steps from the tax reductions carried out by the government so far?
“We must first understand what the real amount of these savings is and also the resources we have. Having confirmed this, we will continue to make tax cuts without biting off more than we can chew. Our priority is to support the purchasing power of Italians and stimulate the competitiveness of our businesses.”
Can the legislative body’s goal of a permanent tax still be achieved?
“The idea is to continue the rate reduction path.”
What is the philosophy underlying the government’s maneuvers and, from your point of view, sticking to this philosophy, what changes can realistically be put into practice among the many changes that Parliament is making?
«The Government’s goal is growth that moves along two tracks: encouraging consumption and supporting investment. Through tax breaks and decontributions, we have supported salaries and for investments we have proposed hyper-amortization for businesses by 2026. Now we are working to make it at least biannual. I believe this is an important step to provide certainty to the business world and will be one of the priority themes in the next few days. Moreover, continued investment is one of the priorities indicated by the rating agencies themselves in their opinions.”
Banks have been asked to make significant contributions to cover these efforts, could they be asked to make further efforts?
“Look, I believe that first of all we should avoid actions that demonize banks. Their activities are very important for the country’s growth. And from this point of view, in the last few weeks, we have had fruitful discussions with credit institutions. We have to take this into account.”
Because of that?
“We struck a good balance regarding the extent of their contribution to the maneuver.”
So is there still room?
“The final decision rests with Parliament.”
There has been a lot of discussion about the taxation of short-term rentals. For some people, the house must be maintained, for others it is now a financial income and therefore must be taxed. How can we get out of it?
“Common sense is urgently needed. On the one hand, real estate assets and the social function of the house must be protected, on the other hand distortions must be avoided to avoid injustice and guarantee an income that corresponds to the nature of any “income”. Logically, it is one thing to use the property for traditional rental and another to use the platform for short-term rental, to earn more. I am sure that a reasonable synthesis will be found among the forces of the majority.”
There was heated debate over who would benefit most from this move. Does anyone think that the Irpef cuts, designed for the middle class, actually helped raise incomes?
«A lot of things have been supported in recent weeks, but we are not interested in the “the worse the better” philosophy and this does not spark debate. The maneuver numbers speak clearly. As already mentioned, we intervened by allocating almost 3 billion to reduce the Irpef level of the middle class and the lowest income by allocating 2.1 billion. We have eased the tax burden on productivity bonuses, waived meal vouchers and encouraged contract renewals. The facts speak for us.”
Another accusation. The government profits from wages through fiscal constraints, and levies more taxes because of inflation. The ECB said this was not the case and the same measure introduced tax breaks for contract increases and uncomfortable work. Can we do more?
“More and more can be done, in every sense. I say this without taking into account the fiscal constraints, where many wrong things have been said. The truth is that for employees under 35 thousand euros there has been a real, clear and concrete recovery. It is not the Meloni government or Deputy Minister Leo who says so, but the ECB and the Bank of Italy.”
The next budget, namely the 2027 budget, will be the last budget of this administration. If you had to choose one measure to bet all your chips on next year, which would you choose?
«I will continue the path of tax reduction and the creation of a simple and orderly tax system, especially compared to the one inherited in 2022. We want to achieve this goal not in the interests of the government, but above all in the interests of Italian society».
So the idea is to continue the tax reform that you so strongly support. What do you think of the current implementation and in what timeframe do you think the consolidation text required to make the system simpler can be completed?
«We are carrying out important reforms: so far 18 legislative decisions and 5 consolidated texts have been definitively approved. I can proudly say and I claim it on behalf of the government, we have lowered personal income tax, rationalized the system and changed the tax-payer relationship: we no longer intervene ex post but ex ante, communicating with citizens and businesses to avoid investigations and disputes. The goal is a tax code, which has never been passed in the history of this country.”
Meanwhile, have you provided assistance to the third sector?
“We have extended the VAT exemption for third sector bodies until 1 January 2036, to avoid administration and management costs that could be difficult for thousands of businesses. This is an option that provides stability and recognizes the social role of the sector.”
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