And the Minister of Economy Giancarlo Giorgetti, meanwhile, met
yesterday in Washington with the general director of the IMF KristalinaGeorgieva and, the Treasury Ministry reports, he "received praise for
his commitment to pursuing budget consolidation while promoting growth".
---- (from Sole 24 Ore of 26.10.2024) ---- To frame the context in which
the stability law presented to the Chamber in recent days is placed, it
is good to start from this (almost) unconditional applause from the
highest international financial institutions to the government of the
one who wanted to "end the easy life" for the EU.
In reality, we have all ended the easy life, we Italians hostages of
these governments, assuming and not granting that we have ever seen any
form or hint of the easy life.
The government signed the new European Stability Pact months ago and
committed to respecting its constraints, albeit over a longer period of
time and with the possibility of exemptions for some spending items
("investments", spending on armaments, structural reforms). This budget
law therefore represents a step in the path of cuts that the government
must make to lower spending and reduce the monstrous public debt. This
is why spending must be cut: after a 40% surge in the five-year period
2019-2024 (double the inflation rate), now is the time to slow down,
because public debt is close to 3,000 billion and we need to "reassure
the markets". All this is happening when GDP is stalling (it will
perhaps rise by 0.8% in 2025), the German recession is affecting the
economy of the entire Union and France is visibly struggling on an
uphill road.
It was therefore necessary to throw away the acrobatic promises of the
electoral campaign, fired by all the members of the government team:
minimum pensions of 1,000 euros for Forza Italia, the cancellation of
the Fornero law for the League, the everything and more sworn by the
Brothers of Italy after 12 years of opposition. This law clarifies the
last misunderstandings and cleanses the illusions.
The structure of the measure cuts spending by 30 billion, bringing it
down from 1,230 billion to 1,200 billion (especially due to the drop in
interest rates on debt and the different composition of the tax wedge).
The rating agencies appreciate and praise the Minister of the Treasury:
Fitch, S&P and DBRS confirm the rating or even raise the outlook for the
future. If the Italian population is worse off, international capital
enjoys because investments are safe and the value of assets is growing.
Overall, the maneuver is worth about 29 billion and focuses, for 60%, on
the confirmation of the cut to the tax wedge and the modulation of the
Irpef on the three rates, as happened in 2024. However, the intervention
becomes structural and changes the methods of application. No longer a
7% cut for incomes up to 20,000 euros and 6% for those up to 35,000. Now
the system works differently: a differentiated exemption up to 20,000
euros, a fixed deduction of 1,000 euros up to 32,000 euros and then a
progressively decreasing deduction up to 40,000 euros. A very
complicated system that serves to leave everything unchanged for low
incomes and make more money reach those with an income of around 35,000
euros: these workers will get about 1,000 euros more on an annual basis.
It is the defense of the middle class!
The same logic supports the intervention on pensions. The revaluation of
pensions decreases, following the decline in "recognized" inflation.
After 8.4% in 2022 and 5.6% in 2023, inflation in 2024 will settle below
2%. The government has chosen to return to the previous system,
eliminating the "progressivity" introduced in 2023. Minimum pensions
increase by the ridiculous amount of 3 (three) euros per month; pensions
up to 4 times the minimum will have full revaluation. Those above that
amount will suffer a penalty, but lighter than in previous years. Let's
help the richest, here too!
As for services, health and education are the most penalized sectors.
Despite Meloni boasting about having invested more resources than ever
in healthcare, the increase of 1.3 billion euros keeps the ratio between
public healthcare spending and GDP stable (6.3%), where Germany invests
11%, France 10% and the United Kingdom 9%. What is missing in Italy is
made up by private individuals, with 40 billion in additional spending
paid for by their own pockets: those who are rich or insured can make
it, the others give up on treatment. There are over 4.5 million patients
who are forced to not be able to seek treatment.
There is no forecast for the healthcare personnel hiring plan that had
been hypothesized (30,000 doctors and nurses) and the resources for
contract renewals are insignificant (17 euros per month for doctors in
2025). Doctors and nurses have already called a strike for November 20.
Schools are also in trouble: the freeze on staff turnover will reduce
the teaching staff by 5,660 teachers and the ATA staff by 2,174
employees. The allocation for the 2022-2024 contract remains at a 6%
increase in the three-year period, while even for the three-year period
2025-2027 the expenditure item is completely insufficient to recover
inflation.
The government has confirmed the 5% tax relief for productivity bonuses
for the next three years: 18,000 company agreements have benefited from
it, involving almost 5 million employees, subtracting an average of
1,500 euros from taxable income and contributions. It seems like a good
measure for workers, but in reality it is a way to save money for
companies, reducing public revenue.
The axe finally falls on the superbonus, dragging with it a good part of
the tax breaks for building renovations. The 110% superbonus has
certainly opened a hole in the state accounts and Giorgetti's statement
("such a volume of resources has never been used to help such a small
number of beneficiaries") has a grain of truth. But from now on the
percentage of deduction will be reduced to 50% for the first home and to
36% for second homes, the maximum ceiling will be halved from 96,000 to
48,000 euros and only the bonus for furniture and the removal of
architectural barriers will be saved. An era is ending, and with it a
tool that had played an important role in relaunching the economy,
construction and the fight against undeclared work. Which will return in
a big way, given the low convenience in "demanding" the invoice.
Among the innovations introduced to encourage labor mobility, given the
alleged difficulty of companies in finding qualified labor, is the
increase to 5,000 euros of the maximum threshold of fringe benefits,
which can now also include the rental costs of those who accept a
transfer beyond 100 km from their residence. Another assist for
companies, which can even take advantage of an increase to 130% of the
deduction of labor costs relating to the hiring of a worker belonging to
certain categories (young people under 30, women with two children,
women victims of violence, former recipients of Rdc).
A measure that has held sway, among the revenues, is the one relating to
the extra profits of banks and insurance companies. Failed in 2023, it
has now been re-proposed in a completely stripped-down form. In fact, it
is not a tax, but the advance of money that will be returned from 2027
onwards. Banks will contribute four billion over two years through the
suspension of tax deductions related to DTA[deferred tax assets, more
simply advance taxes]and goodwill (money that will be returned with the
restart of deductions). Insurance companies (which are asked for 2
billion over four years) will simply have to act as a tax substitute,
withdrawing in advance from life insurance policy holders (financial
investments) the 2 per thousand stamp duty, which is generally paid only
at the time of final redemption. It thundered so much that it rained,
one might say!
For the rest, we are in the presence of the usual mass of transfers to
the business system and linear cuts for each individual ministry (7.7
billion in the three-year period and 2.5 billion in 2025 alone).
The law is locked down, both in the Parliamentary Commission and in the
Chamber (where it will arrive around November 20): it seems that
deputies and senators have the usual ban on amendments and that they
only have 120 million euros available to move a few individual budget
items. In the face of parliamentary debate!
The only way to force the government to withdraw the maneuver, or change
it at the root, is entrusted to social mobilization. It will be an
autumn of clash and conflict, to defeat this carrot and stick policy,
which tries to disarticulate the social opposition with measures and
arguments that are the subject of hammering and totalitarian propaganda.
There are no alternatives available and we cannot back out.
Renato Strumia
https://umanitanova.org/legge-di-stabilita-2025-genuflessioni-per-meloni/
_________________________________________
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