2026 budget law: what has been approved and what changes

Budget law cards: title, summary, status and source

Full list of the cards in the tool. With JavaScript enabled it is replaced by the interactive version, with filters and the "Ask the budget law" box. Updated on 7 November 2026.

• 2026 personal income tax rates: the second rate drops to 33%

  Status: In force

  For 2026 personal income tax applies at three rates: 23% up to EUR 28,000 of income, 33% above 28,000 and up to 50,000, and 43% above 50,000. The budget law lowered the second rate from 35% to 33%.

  Effective from: Tax year 2026 Deadline: No end date stated

  Source: Law no. 199 of 30 December 2025, art. 1, para. 3; art. 11, para. 1, TUIR (Presidential Decree 917/1986). From 1/1/2027 the rules sit in art. 11 of Legislative Decree 117/2026.

• Hyper-depreciation 2026-2028 for new capital goods

  Status: In force

  For businesses investing between 1/1/2026 and 30/9/2028 in new capital goods used in production sites in Italy, the acquisition cost is increased, for income tax purposes only and for depreciation instalments and lease payments, by 180% for investments up to EUR 2.5 million, by 100% above 2.5 and up to 10 million, and by 50% above 10 and up to 20 million.

  Effective from: Investments from 1/1/2026 Deadline: Investments up to 30/9/2028

  Source: Law 199/2025, art. 1, paras. 427-436 (until 31/12/2026); from 1/1/2027 new TUIR (Legislative Decree 117/2026, annex), art. 364, with art. 376 (repeals) and art. 377 (application); MIMIT-MEF implementing inter-ministerial decree (para. 433).

• Hyper-depreciation: implementing decrees and GSE notices

  Status: In force

  To access hyper-depreciation the business sends GSE, electronically and on standard forms, notices and certifications on eligible investments. The implementing rules are left to a MIMIT decree agreed with the MEF, to be adopted within thirty days of the law coming into force.

  Effective from: Platform from 12/6/2026 (to be checked) Deadline: To be verified

  Source: Law 199/2025, art. 1, paras. 430, 433, 435 and 436.

• Hyper-depreciation: origin of goods and photovoltaic modules

  Status: In force

  In the budget law text in force, para. 429 lists the eligible goods (interconnected Annex IV and V goods and plants for self-production from renewable sources) without requiring European production. For solar energy only plants with the photovoltaic modules of art. 12, para. 1, letters b) and c), of Decree-Law 181/2023 are eligible.

  Effective from: Investments from 1/1/2026 Deadline: No end date stated

  Source: Law 199/2025, art. 1, para. 429; Decree-Law 38/2026, art. 7 (converted by Law 88/2026); Decree-Law 181/2023, art. 12, para. 1.

• Investment tax credit in the single special economic zone extended to 2028

  Status: In force

  The tax credit for investments in the single special economic zone (art. 16 of Decree-Law 124/2023) is extended to the years 2024, 2025, 2026, 2027 and 2028 and to the Marche and Umbria regions in addition to those already included.

  Effective from: Investments from 1/1/2026 Deadline: 31/12/2028

  Source: Law 199/2025, art. 1, paras. 438-452; art. 16 Decree-Law 124/2023.

• Tax credit for energy-intensive and gas-intensive businesses: 2025 investments

  Status: Awaiting implementation

  Businesses included for 2025 in the CSEA lists of electricity-intensive or gas-intensive businesses are granted a tax credit for investments in new tangible and intangible capital goods listed in Annexes A and B to Law 232/2016 made from 1/1/2025 to 31/12/2025, at the rates of paras. 4, 5, 7 and 8 of art. 38 of Decree-Law 19/2024.

  Effective from: Investments from 1/1/2025 to 31/12/2025 Deadline: Spending limit refers to 2026; implementing decree not identified

  Source: Law 199/2025, art. 1, paras. 962-964; Decree-Law 19/2024, art. 38, paras. 4, 5, 7 and 8.

• 20% super-deduction on the cost of new permanent hires

  Status: In force

  Businesses and professionals that increase permanent headcount may deduct the cost attributable to the increase plus 20% (cost deducted at 120%), with a further increase for categories of workers deserving greater protection. It applies to tax years 2025 to 2027.

  Effective from: Tax year 2025 (the base rules apply from 2024) Deadline: Tax year 2027

  Source: Legislative Decree 216/2023, art. 4; Law 207/2024, art. 1, paras. 399-400.

• Business capital gains: no more instalment taxation on single assets

  Status: In force

  From 2026 realised capital gains are taxed in full in the year of realisation. Taxation in equal instalments, up to the fourth year, remains only for the sale of a business or branches held for at least three years (and for athletes' performance rights).

  Effective from: From 2026 Deadline: No end date stated

  Source: Law 199/2025, art. 1, para. 42; art. 86, para. 4, TUIR.

• Regional production tax: two-point increase for certain categories (2026-2028)

  Status: In force

  For 2026 and the following two years the regional production tax rates in art. 16, para. 1-bis, letters b) and c), of Legislative Decree 446/1997 are increased by two points for taxpayers other than those in art. 6, paras. 2, 3, 4 and 9.

  Effective from: Tax year 2026 Deadline: Three tax years (2026-2028)

  Source: Law 199/2025, art. 1, para. 74; art. 16 Legislative Decree 446/1997; Law 234/2021, art. 1, para. 8.

• Regional production tax: further two-point increase for certain ATECO codes (2026-2027)

  Status: In force

  For 2026 and the following tax year the regional production tax rate (paras. 1 and 1-bis of art. 16) is increased by two points for taxpayers whose main activity falls within the ATECO codes in table 1 of Decree-Law 21/2026.

  Effective from: Tax year 2026 Deadline: Tax year 2027

  Source: Decree-Law no. 21 of 20 February 2026, art. 3, para. 1.

• Youth Bonus 2026: social security relief for hiring under-35s

  Status: In force

  An employer who hires, on a permanent contract between 1/1/2026 and 31/12/2026, a non-managerial worker under 35 with no regularly paid job for at least 24 months (12 for some disadvantaged categories) does not pay employer social security contributions up to EUR 500 a month, for up to 24 months (12 for the disadvantaged categories indicated).

  Effective from: Hires from 1/1/2026 Deadline: Hires by 31/12/2026 (benefits up to 24 months)

  Source: Decree-Law no. 62 of 30 April 2026, art. 2 (converted by Law 112/2026); funding in Law 199/2025, art. 1, paras. 153-155. INPS: circular no. 55 of 14/5/2026 and message no. 1966 of 11/6/2026 (applications open from 11/6/2026).

• Women's Bonus 2026: social security relief for hiring women

  Status: In force

  An employer who hires, on a permanent contract between 1/1/2026 and 31/12/2026, a woman with no regularly paid job for at least 24 months (12 for some disadvantaged categories) does not pay employer social security contributions up to EUR 650 a month, for up to 24 months.

  Effective from: Hires from 1/1/2026 Deadline: Hires by 31/12/2026

  Source: Decree-Law no. 62 of 30 April 2026, art. 1 (converted by Law 112/2026). INPS: circular no. 57 of 14/5/2026.

• Relief for hiring mothers of at least three minor children

  Status: In force

  An employer who hires from 1/1/2026 a mother of at least three minor children, with no regularly paid job for at least six months, does not pay employer contributions up to EUR 8,000 a year: for 12 months if the hire is fixed-term, 18 if converted to permanent, 24 if permanent from the start.

  Effective from: Hires from 1/1/2026 Deadline: No end date; annual spending limit

  Source: Law 199/2025, art. 1, paras. 210-213. INPS: circular no. 82 of 29/7/2026.

• Relief for part-time work for parents of at least three children (awaiting decree)

  Status: Awaiting implementation

  Employers who convert to part time, on request, the contract of a worker with at least three cohabiting children, without reducing total hours worked, will receive relief from employer contributions up to EUR 3,000 a year for 24 months.

  Effective from: From the conversion, after the implementing decree Deadline: Annual spending limit

  Source: Law 199/2025, art. 1, paras. 214-218.

• Incentive for converting under-35s to permanent contracts

  Status: In force

  An employer who converts to a permanent contract, without interruption, a fixed-term employment of no more than 12 months (started by 30/4/2026) of a worker under 35 never previously employed on a permanent contract does not pay employer social security contributions up to EUR 500 a month, for up to 24 months.

  Effective from: Conversions from 1/8/2026 Deadline: Conversions by 31/12/2026

  Source: Decree-Law 62/2026, art. 4 (converted by Law 112/2026). INPS: circular no. 72 of 3/7/2026 and message no. 2518 of 29/7/2026.

• Fair pay: condition for the Decree-Law 62/2026 incentives

  Status: In force

  To obtain the 2026 hiring incentives the employer must provide total pay not lower than that of the collective agreement signed by the comparatively most representative organisations for the sector and category.

  Effective from: From the entry into force of Decree-Law 62/2026 Deadline: No end date stated

  Source: Decree-Law 62/2026, art. 7.

• Premium corporate tax rate: the four-point cut appears limited to 2025

  Status: Expired

  The ordinary corporate tax rate is 24%. The four-point reduction for companies that retain profits and invest, set by the 2025 budget law, appears to apply only to tax year 2025 and not renewed for 2026.

  Effective from: Tax year 2025 Deadline: Tax year 2025

  Source: Law 207/2024, art. 1, paras. 436-444; Ministerial Decree 8 August 2025; art. 77 TUIR.

• Dividends: the shareholding thresholds in paras. 51-55 appear repealed

  Status: In force

  Paras. 51 and 52 of art. 1 of the 2026 budget law, which dealt with the dividend regime with shareholding thresholds, appear repealed by Decree-Law no. 38 of 27 March 2026. The ordinary regime remains: 26% for individuals and 5% taxable for companies.

  Effective from: To be checked (1/1/2026 according to internal checks) Deadline: No end date stated

  Source: Law 199/2025, art. 1, paras. 51-52; Decree-Law no. 38 of 27 March 2026.

• Flat-rate regime: the EUR 35,000 employment income limit also applies for 2026

  Status: In force

  The flat-rate regime cannot be used by anyone who in the previous year received employment or assimilated income above EUR 35,000. The threshold, set for 2025, also applies for 2026.

  Effective from: Year 2026 Deadline: Year 2026

  Source: Law 199/2025, art. 1, para. 27, amending Law 207/2024, art. 1, para. 12; Law 190/2014, art. 1, para. 57, letter d-ter).

• Flat-rate regime: revenue thresholds and substitute tax

  Status: In force

  The flat-rate regime is for those with revenue or fees of up to EUR 85,000; you leave it within the same year if you exceed EUR 100,000. The substitute tax is 15%, reduced to 5% for the first five years of a new activity.

  Effective from: Regime in force; no change to the thresholds located in the parts of the 2026 budget law that were read Deadline: No end date stated

  Source: Law 190/2014, art. 1, paras. 54-89; from 1/1/2027 Legislative Decree 117/2026.

• Productivity bonuses taxed at 1% up to EUR 5,000

  Status: In force

  Productivity bonuses paid in 2026 and 2027 to private-sector employees with employment income in the previous year up to EUR 80,000 are taxed at a 1% flat rate within EUR 5,000 gross.

  Effective from: Bonuses paid in 2026 Deadline: Bonuses paid in 2027

  Source: Law 208/2015, art. 1, paras. 182-189; Law 199/2025, art. 1, para. 9. Revenue Agency, resolution no. 22/E of 9/6/2026.

• 5% flat tax on pay increases from collective agreement renewals

  Status: In force

  In 2026 pay increases paid under collective agreements renewed between 1/1/2024 and 31/12/2026 are taxed at a 5% flat rate (income tax and surtaxes) for private-sector employees with 2025 employment income up to EUR 33,000.

  Effective from: Increases paid from 1/1/2026 Deadline: 31/12/2026

  Source: Law 199/2025, art. 1, paras. 7 and 12. Revenue Agency, circulars no. 2/E of 24/2/2026 and no. 3/E of 24/6/2026.

• 15% flat tax on night, holiday and shift work

  Status: In force

  For 2026 premiums and allowances for night work, holiday work, weekly rest and shift work are taxed at 15% (income tax and surtaxes) up to EUR 1,500 a year, for private-sector employees with 2025 employment income up to EUR 40,000.

  Effective from: 1/1/2026 Deadline: Tax year 2026

  Source: Law 199/2025, art. 1, paras. 10-12. Revenue Agency, circulars no. 2/E of 24/2/2026 and no. 3/E of 24/6/2026.

• Overtime of healthcare and social-care staff: 5% substitute tax

  Status: In force

  The 5% substitute tax on personal income tax and surcharges, already provided for overtime pay of National Health Service nurses (Law 207/2024, art. 1, para. 354), also applies to overtime pay of nurses employed by accredited private healthcare and social-healthcare facilities, including nursing homes (RSA) and other residential and social-care facilities.

  Effective from: Pay given from 2026 Deadline: No end date stated in the text read

  Source: Law 199/2025, art. 1, paras. 944-945; Law 207/2024, art. 1, para. 354; Revenue Agency, resolution no. 7/E of 31/1/2025 and FAQ of 28/7/2026.

• Special 15% supplement for tourism, catering and spa workers

  Status: Expired

  From January to September 2026 workers in bars, restaurants, tourism and spa establishments with 2025 income up to EUR 40,000 received a supplement equal to 15% of gross pay for night work and holiday overtime.

  Effective from: 1/1/2026 Deadline: 30/9/2026

  Source: Law 199/2025, art. 1, paras. 18-21.

• Fringe benefits tax-free up to EUR 1,000 (EUR 2,000 with children)

  Status: In force

  For tax years 2025, 2026 and 2027, goods and services given to employees, and sums paid or reimbursed for household utilities, rent or mortgage interest on the main home, are excluded from income up to EUR 1,000 a year, rising to EUR 2,000 for employees with dependent children.

  Effective from: Tax year 2025 Deadline: Tax year 2027

  Source: Law 207/2024, art. 1, paras. 390-391 (2025 budget law). Revenue Agency, circular no. 5/E of 2025.

• Meal vouchers: exempt up to EUR 10 a day if electronic

  Status: In force

  From 2026 electronic meal vouchers are exempt up to EUR 10 a day; paper vouchers stay at EUR 4. The excess is taxable.

  Effective from: 1/1/2026 Deadline: No end date stated

  Source: Art. 51, para. 2, letter c), TUIR, as amended by Law 199/2025, art. 1, para. 14.

• Dividends on shares granted in lieu of bonuses: 50% exempt up to EUR 1,500

  Status: In force

  Dividends received by employees on shares granted in place of productivity bonuses are excluded from income for 50% of their amount, up to EUR 1,500 a year. The measure, set for 2025, is extended to 2026.

  Effective from: 2025, extended to 2026 Deadline: 31/12/2026

  Source: Law no. 76 of 15 May 2025, art. 6, para. 1; Law 199/2025, art. 1, para. 13.

• Rent reimbursement for relocated new hires: exempt up to EUR 5,000 (2025 hires)

  Status: In force

  For employees hired on permanent contracts in 2025, with income up to EUR 35,000 in the previous year, who moved their residence to a municipality more than 100 km from the previous one, employer reimbursements of rent and maintenance costs are exempt from income tax up to EUR 5,000 a year for the first two years.

  Effective from: 2025 hires Deadline: 24 months from hiring (so until 2027)

  Source: Law 207/2024, art. 1, paras. 386-389.

• Payroll tax wedge cut: non-taxable sum and extra tax credit (2025 budget law)

  Status: In force

  Employees with total income up to EUR 20,000 receive a non-taxable sum equal to 7.1% of employment income up to EUR 8,500, 5.3% up to 15,000 and 4.8% up to 20,000. Above 20,000 an extra tax credit of EUR 1,000 applies up to 32,000 of income and then decreases to zero at 40,000.

  Effective from: From 2025 Deadline: No end date in the text read

  Source: Law no. 207 of 30 December 2024, art. 1, paras. 4-9.

• Tax credits cut by EUR 440 above EUR 200,000 of income

  Status: In force

  Taxpayers with total income above EUR 200,000 see the tax credit under art. 16-ter TUIR reduced by EUR 440.

  Effective from: 2026 budget law; first tax year of application to be checked against the text of the paragraph Deadline: No end date stated

  Source: Law 199/2025, art. 1, para. 4; art. 16-ter, para. 5-bis, TUIR.

• Settlement of debts entrusted for collection 2000-2023: applications closed, payments under way

  Status: In force

  Debts from collection entrusted to the collection agent from 1/1/2000 to 31/12/2023, arising from unpaid taxes shown in returns (automated and formal checks) or unpaid INPS contributions, excluding those from assessments, may be settled without paying interest, penalties and late-payment interest. The application had to be filed by 30 April 2026.

  Effective from: Application by 30/4/2026; payments from 31/7/2026 Deadline: Last instalment 31/5/2035

  Source: Law 199/2025, art. 1, paras. 82-87.

• Concessional assignment or sale of assets to members and conversion to a simple partnership

  Status: Expired

  General partnerships, limited partnerships, limited liability companies, joint-stock companies and partnerships limited by shares that by 30 September 2026 assign or sell to members non-instrumental real estate or registered movables not used as instrumental assets may apply a substitute tax on the difference between market value and tax cost: 8%, or 10.5% for companies that were non-operating in at least two of the three preceding tax years.

  Effective from: Operations by 30/9/2026 Deadline: 30/9/2026 (expired)

  Source: Law 199/2025, art. 1, paras. 35-41.

• Youth and South contribution reliefs: interpretive extension to the ATECO codes in Annex XIV

  Status: In force

  The 2026 budget law interprets the rules on relief for hiring young people (art. 1, paras. 10-15, Law 178/2020) and on contribution relief for the South (paras. 161-167) as applying, from 1/7/2022, also to private employers carrying on the activities of the ATECO codes in Annex XIV, within the limits of the European Commission decision of 19/6/2023.

  Effective from: From 1/7/2022 (interpretation) Deadline: No end date stated

  Source: Law 199/2025, art. 1, para. 860 (interpreting Law 178/2020, art. 1, paras. 10-15 and 161-167).

• Contribution of up to EUR 1,500 for private secondary schools (ISEE up to 30,000)

  Status: Awaiting implementation

  For 2026 the Ministry of Education and Merit grants families with ISEE not above EUR 30,000 a contribution of up to EUR 1,500 for each student attending a private secondary school of lower level or the first two years of upper secondary.

  Effective from: Year 2026 Deadline: Year 2026

  Source: Law 199/2025, art. 1, para. 519.

• 2026 INPS contributions for craftsmen and traders

  Status: In force

  For 2026 the minimum income is EUR 18,808. Rates are 24% for craftsmen and 24.48% for traders, with one extra point above the first income bracket (EUR 56,224). The ceiling is EUR 93,707 (EUR 122,295 for those enrolled from 1996).

  Effective from: Year 2026 Deadline: Year 2026

  Source: INPS circular no. 14 of 9 February 2026.

• 2026 INPS separate management scheme: rates and ceiling

  Status: In force

  For 2026 the rate is 35.03% for directors, auditors and collaborators (33.72% without the DIS-COLL unemployment benefit), 24% for pensioners or those covered by another scheme, and 26.07% in the table for professionals with a VAT number. The ceiling is EUR 122,295.

  Effective from: Year 2026 Deadline: Year 2026

  Source: INPS circular no. 8 of 3 February 2026.

• 2026 domestic work: INPS hourly contributions

  Status: In force

  For 2026, for permanent contracts, the total hourly contribution is EUR 1.70 (of which 0.43 paid by the worker) for hourly pay up to EUR 9.61, 1.92 (0.48) from 9.61 to 11.70, 2.34 (0.59) above 11.70, and 1.24 (0.31) for contracts above 24 hours a week.

  Effective from: Year 2026 Deadline: Year 2026

  Source: INPS circular no. 9 of 3 February 2026.

• INAIL: new minimum and maximum annuity limits from 1/7/2026

  Status: In force

  From 1/7/2026 the INAIL annuity minimum is EUR 20,712.30 and the maximum is EUR 38,465.70.

  Effective from: 1/7/2026 Deadline: No end date stated

  Source: INAIL circular no. 35 of 22 July 2026; Labour Ministerial Decree 11/5/2026.

• New consolidated income tax code (Legislative Decree 117/2026): applies from 2027

  Status: Awaiting implementation

  Legislative Decree no. 117 of 19 June 2026 approves the new consolidated income tax code, in force from 4/7/2026. Its rules apply from 1/1/2027; for 2026 the articles of the old TUIR still apply.

  Effective from: In force from 4/7/2026; applies from 1/1/2027 Deadline: No end date

  Source: Legislative Decree no. 117 of 19 June 2026 (Official Gazette no. 152 of 3/7/2026, special supplement no. 26).

• 2027-2029 budget: the bill is before the Chamber of Deputies (not approved)

  Status: Under discussion

  The Minister of Economy submitted to the Chamber of Deputies on 30 October 2026 Bill A.C. 3174, "State budget for financial year 2027 and multi-year budget for 2027-2029". It is not approved and the text may change during parliamentary examination. From the Chamber of Deputies site: assigned to the Budget Committee (V), which on 4/11/2026 carried out the check of the bill's proper content (art. 120, para. 2, Chamber Rules); the bill page lists the derived acts 3174-bis, -ter, -quater and -quinquies.

  Effective from: Not applicable: not approved Deadline: The budget law must be approved by year end

  Source: Chamber of Deputies, A.C. 3174 (19th legislature).