What to expect in the 2025 Budget Law: pension and tax chaos, salaries unchanged.

What to Expect from the 2025 Budget Law?

With a month to go until the government’s publication of the structural budget plan – the deadline is set for September 20 – there seem to be discrepancies among the majority parties on how to shape this economic maneuver, which will inevitably also have to take into account the infringement procedure that will lead us to having to make 84 billion in cuts to public spending over the next seven years.

As politics is officially on hold for the holidays, all discussions have been postponed to September.
However, the numbers for the 2025 Budget Law have been circulating for some time: a total cost of 25 billion, with most of the coverage expected to come from increased tax revenues that should provide the government with a treasury of around 16 billion.

Minister Giancarlo Giorgetti, however, has refrained from elaborating on the potential increase in tax revenues, which, in the first six months of the year, showed a +4.1% rise, worth a dozen billion; if the same trend continues in the second half, the Treasury would be ready to bring out the proverbial champagne.

The other funding sources for the 2025 Budget Law should come from the ministry’s spending review and cuts to tax deductions, totaling 5 billion.
The remainder of the funds could come from new amnesties and regularization initiatives, as the government, unlike in past years, will not be able to rely on debt to finance the various measures of the maneuver.

The funds allocated for the three major topics under discussion – pensions, salaries, and taxes – are consequently limited: there are already genuine battles underway among the majority parties to promote their own agendas, with the atmosphere not appearing to be the most conducive, even though ultimately, the last word will lie with Prime Minister Giorgia Meloni, who, as in the previous year, would be ready to safeguard the text from the inevitable onslaught of amendments in Parliament.

The 2025 Budget Law: What to Expect

The 2025 Budget Law is expected to be substantially a copy of the one approved by the center-right last year.
The government will indeed have to make a considerable effort to refinance for another year all the measures that will cease to be in force on December 31.

Once again, there will be no structural reforms of pensions or the tax system: the government has stated that the commitments made during the election campaign will be fulfilled by the end of the legislature, but this promise seems challenging to keep.

In the 2025 Budget Law, the main effort will be made to extend the tax wedge cut, thus saving the salaries of about 14 million workers.
However, the problem is that in a year, there will be the challenge of finding another 11 billion to confirm the measure even in 2026 and so on.

However, the hottest issue is undoubtedly that of pensions.
The League seems to be back on the offensive for the “Quota 41”, while Forza Italia would like to increase the minimum pensions.
The feeling is that both parties will be left empty-handed, with the probable confirmation of the pension measures taken in the last Budget Law.

When it comes to taxes, an agreement seems more within reach.
The confirmation of the three IRPEF rates is likely, but some are pushing for more: without additional resources, however, it will be impossible to implement further tax measures.

Finally, in the 2025 Budget Law, there should be a confirmation of the childbirth package – very dear to Prime Minister Meloni – funds for the renewal of public contracts, funds for healthcare, and financing for missions abroad.
As for major reforms, we will have to wait.