Italy Cabinet Approves 2027 Budget with Tax Cuts and Sector Hikes

Italy’s cabinet has approved a roughly €26 billion draft budget for 2027, the final budget before the expected election, combining tax cuts and social spending as the government responds to cost-of-living pressures. The plan raises the income threshold for the 33% tax rate to €55,000, expands eligibility for the self-employed flat-tax regime, and includes support for families, younger workers, health care and vehicle owners. To help pay for the measures, the government plans higher taxes on banks, insurers, energy companies and the gaming sector, while targeting a 3.4% budget deficit; parliament must approve the draft before it is submitted to the EU for review.