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Late Tuesday, Italian lawmakers approved a draft budget for 2025, which is partially funded by banks and insurance companies. The plan also includes tax cuts for low-income families, a key priority for far-right Prime Minister Giorgia Meloni.
"3.5 billion euros from banks and insurance companies will be earmarked for healthcare and the most vulnerable people to ensure better services closer to everyone's needs," Meloni said on X.
An outline of the 2025 budget, because of Italy's membership within the European Union's single currency, must still be sent to Brussels. As in last year's budget, ministers sought to balance electoral promises with the need to reduce deficits and avoid adding to Italy's mounting debt. The budget contains measures worth around 25 billion euros, of which banks are expected to contribute "three to four billion euros", deputy prime minister and foreign minister Antonio Tajani has said.
But he insisted there would be "no new taxes" on the institutions, after the announcement last year of a 40 percent tax on bank "superprofits", made from the rise in interest rates, sparked a backlash on the financial markets.
Tajani, leader of the right-wing Forza Italia party, described the tax -- which was swiftly watered down -- as a Soviet-style levy.
But fellow deputy prime minister Matteo Salvini, from the far-right League, has said that if anyone has to pay more, "let the bankers pay and not the workers".
In place of the windfall tax, the government has considered spreading out tax credits for banks over time and increasing taxes on their executives' stock options.
Italy -- targeted by the European Union for its "excessive" deficits, just like France -- is under intense pressure to balance its books and reduce a debt close to three trillion euros. The government has committed to reducing the public deficit to 2.8 percent of gross domestic product (GDP) by 2026, below the 3 percent eurozone ceiling. To curb spending, Rome has urged individual ministries to tighten their belts, to free up around three billion euros in savings.
Ministers were expected to allocate around 15 billion euros to maintain a cut in taxes and social security contributions for those on low incomes, an election issue dear to Meloni.
Lewis Musonye
