📊 Introduction to the Budget Law 2024
The Italian Budget Law 2024, officially enacted with its publication in the Official Gazette No. 303 on December 30, 2023, marks a significant turning point for Italian fiscal policy.
With a budget of approximately 28 billion euros, the law primarily aims to support low to medium incomes, families, birth rates, and renew public employee contracts, in addition to strengthening healthcare spending and public and private investments.
🔄 Main Fiscal Reforms and Innovations
🔹 IRPEF Reform
The Budget Law 2024 introduces a significant change to the IRPEF structure, reducing tax brackets from four to three.
The rate for incomes up to 28,000 euros has been set at 23%.
Moreover, the renewal of the fiscal and contributory wedge cut is targeted at low to medium incomes, with 7% for incomes up to 25,000 euros and 6% up to 35,000 euros.
These measures, along with expanding the no tax area up to 8,500 euros, aim to strengthen the paychecks of employees, potentially increasing up to 1,298 euros annually.
🔹 Fringe Benefits
In the Budget Law 2024, fringe benefits see an increase in the non-taxable threshold: 1,000 euros for most employees and 2,000 euros for those with dependent children. This change complements the contributory wedge cut and other payroll support measures.
Fringe benefits can now include expenses for domestic utilities, rent, or mortgage of the primary residence, making these bonuses more versatile and beneficial for employees.
🔹 Support for Families and Birth Rates
The Budget Law 2024 provides various measures to support families, including the enhancement of the nursery school bonus, with an increase up to 3,600 euros annually for families with an ISEE up to 40,000 euros and another child under 10 years.
It also includes an additional month of paid parental leave with an 80% allowance for parents with children up to 6 years.
Additionally, the issuance of the "Dedicated to You" card for essential goods and the renewal of the social bonus for electricity for the first quarter of 2024 are confirmed.
🔹 Productivity Bonuses
The tax exemption of productivity bonuses has been confirmed and enhanced for 2024, maintaining the substitute tax rate at 5% instead of 10%.
These bonuses are recognized for private sector workers earning up to 80,000 euros.
The limit for tax exemption rises to 4,000 euros when employees are equally involved in the organization of work.
This measure aims to encourage bonuses linked to increases in productivity, profitability, quality, efficiency, and innovation.
🔹 IVIE and IVAFE Rates
The Budget Law 2024 leads to an increase in the rates for the Tax on the Value of Real Estate Abroad (IVIE) and the Tax on the Value of Financial Assets Held Abroad (IVAFE).
From January 1, 2024, the standard IVIE rate has increased from 0.76% to 1.06%, while for IVAFE, the rate applied to the value of financial products held abroad has doubled, from 2 per thousand to 4 per thousand, but only for financial products held in states or territories with a privileged tax regime.
🔹 Revaluation of Land and Share Acquisition Values
The Financial Law 2024 extends the possibility to revalue the acquisition cost of traded and non-traded shares in regulated markets, and of building and agricultural lands, owned as of January 1, 2024, not in a business regime.
Revaluation can be made by paying a substitute tax of 16%, with the option to pay in three equal installments starting from June 30, 2024.
To benefit from this measure, a sworn appraisal must be conducted by the same date.
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