Fringe benefits, vouchers, wedge cuts: all the measures decided by the government. Meloni: the biggest tax cut in decades

Four billion for the cut in the tax wedge. The government announced it after the Council of Ministers which launched the labor package, a series of measures which, attacking the Democratic Party and the trade unions, are destined to increase precariousness. “Today and until the end of this year we have cut the contribution wedge by 6 percentage points, for those with incomes of up to 35,000 euros, and even 7 percentage points for the lowest incomes, up to 25,000 euros” he says Giorgia Meloni in a video. «I am proud that the government has chosen to celebrate May 1st with deeds and not with words. And I think further support was due to an economy which, even in a moment of difficulty, is giving us great satisfaction with growth, the Italian one, which is estimated to be higher than that of the other European nations for the coming months”, he continues, defining the operation as “the most major tax cut in decades.

The interventions, in particular, provide for the cut of a further 4 points in the tax and social security wedge and tax-free fringe benefits of up to 3,000 euros for employees with children.

«We invest in workers and families. Let’s lower taxes by up to 7 points – says Giorgetti – for the lowest incomes: it is real help against the cost of living and the concrete answer to the chatter. Additional benefits for workers who have children also come into force. We continue on the responsible path of growth by focusing on social emergencies”.

Here are the key measurements

In the period between 1 July and 31 December 2023 (without further effects on the thirteenth salary), approximately 4 billion euros are earmarked for an increase of 4 percentage points in the cut in the tax wedge for employees compared to what is already provided for by law budget. The contribution relief, all for the benefit of workers, is therefore raised from 3% to 7% for incomes up to 25 thousand euros while it is raised from 2% to 6% for incomes up to 35 thousand. The increase in the payroll of employees is estimated, in the period July-December, up to 100 euros per month on average.

Fringe benefits

The decree provides for 142 million in 2023 to raise the tax exemption threshold of company fringe benefits up to 3 thousand euros for all employees with minor children. “It is a measure that aims to support families by limiting the impact of inflation on incomes,” says the Treasury. With the provision, the government also approved a package of employment measures which activate the reform of the citizen’s income and provide incentives for hiring. Finally, the refinancing of the fund for the reduction of the tax burden foreseen by the last budget law is foreseen.

Inclusion check
It will arrive from 1 January 2024, as a measure to “combat poverty, fragility and social exclusion”, aimed at families in which there are disabled, minors or over-60s and which could reach 500 euros per month (630 euros if composed of over 67 or with severe disabilities), to which an additional 280 euros per month if they live in rent. It will be disbursed for eighteen months and can be renewed, after a one-month stop, for further periods of twelve months. Must have been resident in Italy for at least five years and have an ISEE not exceeding 9,360 euros. To receive the benefit, you will have to register with the Information System for Social and Employment Inclusion (Siisl).

Activation tool at work
For those who can be employed, it will start from 1 September 2023. Participation in training courses, professional qualification courses or projects useful to the community becomes mandatory. The benefit will be 350 euros and for a maximum of twelve months, non-renewable.

Hiring incentives
Private employers who take on the beneficiaries of the inclusion allowance with permanent or apprenticeship contracts will be granted, for twelve months, 100% exemption from social security contributions, up to a limit of 8 thousand euros per year (at 50 % if temporary or seasonal).

Term contracts
Fewer constraints on the reasons for renewals beyond the year (up to twelve months are not required) and no later than 24 months: the reasons are entrusted to collective agreements or, pending the contractual provision, identified by the parties for needs of technical, organizational or productive nature (in this case in any case by 31 December 2024). *

Voucher
The threshold for so-called casual work is raised from 10,000 to 15,000 euros for those working in the sectors of congresses, fairs, events, spas and amusement parks