Italy’s Coalition Disagrees on Curbs for Home Renovation Incentives
Italy’s ruling coalition faced divisions over new regulations on costly incentives for home renovations on Tuesday. The moderate Forza Italia party opposed the Treasury’s plan, citing potential harm to banks and businesses.
Government Struggles with Previous Incentives
The government led by Prime Minister Giorgia Meloni has struggled to rein in incentives introduced by past administrations. These incentives have depleted state funds by over 219 billion euros in less than four years, straining Italy’s fragile economy.
Proposed Changes to Superbonus Scheme
The most generous incentive, known as the Superbonus, allowed homeowners to offset energy-saving expenses against taxes or use credits for payments. Economy Minister Giancarlo Giorgetti proposed spreading the impact of these tax credits over ten years, retroactively applying since January.
Forza Italia’s Opposition
Foreign Minister Antonio Tajani, from Forza Italia, voiced opposition to the plan and threatened to vote against it without modifications. The party is concerned about the retrospective nature of the scheme affecting banks and businesses negatively.
New Restrictions and Targets
The proposed amendment requires lenders to utilize tax credits purchased over six years from 2025. Banks and financial institutions will no longer offset social security payments with tax credits starting next year. These restrictions aim to help Italy meet stricter deficit targets set for the coming years.
Despite promises to reduce the fiscal deficit, projections suggest it may remain higher than anticipated. The government aims to decrease the gap to 3.6% of GDP by 2025 and further to 2.9% by 2026, though current trends indicate slightly different figures.
With a crucial European Union parliament vote approaching, Tajani’s stance highlights the balancing act between economic stability and incentivizing homeowners.
