The Meloni government is set to launch a 32 billion euro 2023 budget bill, containing 21 billion euro worth of measures to help struggling families and businesses with their power bills amid the energy crisis sparked by the Ukraine war.
Among the other mooted measures is the cancellation of VAT on bread, pasta and milk to help with the cost of living crisis, government sources say.
The labour tax wedge is expected to be cut by three points for those on low incomes.
A flat tax is set to be introduced too, and the threshold is expected to be raised to 85,000 euro a year for the self-employed, sources reported.
The controversial citizenship wage basic income for job seekers and the poor, a flagship policy of the populist 5-Star Movement (M5S) when it was in power, is set to be reduced and reformed, so that claimants can no longer benefit after refusing job offers.
The government is also working on a reform to the pension system to allow early retirement at ‘quota 103’, when people are 62 and have paid in 41 years of contributions.
The government has denied that the budget will also contain a cash bonus for couples who choose to get married in church – a measure proposed by Lega. Amid the furore, it was announced that the bonus would in fact be extended to all marriages.
“The so-called ‘marriage bonus’ will not feature in the package,” said the office of Premier Giorgia Meloni.
Cabinet met at arounf five pm yesterday to discuss the budget bill, which must be approved by the end of the year, and which will be sent to Brussels for approval before it is passed.
