Def, debt over 3 trillion euro by 2025. Giorgetti: 'We aim to adjust accounts in 7 years'.

The government aims at 'agreeing with the European Commission the extension to seven years of the public finance adjustment' in order to put the debt on a reduction path. And the future medium-term structural budget plan to be submitted to the EU "can only start from the results already achieved with the NRP", consolidating investments and reforms on ecological and digital transition and responding "to the investment needs of defence and to the unavoidable objectives of improving social equity and demographic recovery of the country". So writes Economy Minister Giancarlo Giorgetti in the introduction to the Def.

The Def provides an estimate of 'unchanged policies for the next three years, within which priority will be given to refinancing the cut in the tax wedge on labour'. This is stated in the Document sent to Parliament. "In the immediate term, the Government intends to continue adopting measures aimed at intervening on the deficit profile, further improving it also through a revision of the discipline of tax credits in order to bring it below 3 per cent of GDP by 2026, as envisaged in the Nadef. These actions will be aimed at improving not only the accrual balances, but also the cash balances, thus lowering the debt-to-GDP ratio profile already in the short term,' the text continues.

Italy's public debt will break through the psychological threshold of EUR 3,000 billion starting next year. This is the prediction of the tables of the 2024 Defence Document, according to which the total debt of the public administration will rise from the 2,981 billion euro expected for this year to 3,110 billion in 2025, to 3,224 billion in 2026 and to 3,306 billion in 2027, the year in which a downward trajectory of the debt/GDP ratio will begin.

"At the start of the year, the economic outlook seems to have shifted towards a phase of gradual strengthening of growth, despite the uncertainty stemming from an evolving geopolitical context," the Economic and Financial Document goes on to state. "In a framework of increased resilience of the Italian economic system, the return of inflation and the easing of monetary policy should support an increase in demand".

"The tax burden is reduced in 2024 to 42.1 per cent (from 42.5 per cent in 2023, ed.) to rise again in 2025 to 42.4 per cent and settle at a slightly lower level in the final two years of the forecast period." This is stated in the part of the DEF dedicated to 'Analysis and trends of public finance'. Total general government revenues as a ratio of GDP decrease in 2024 by one percentage point compared to 2023, to 46.8 per cent, and are expected to increase in 2025 by 0.3 percentage points and decrease in the following years, reaching 46.2 per cent in 2027. Tax revenues are estimated to decrease gradually, from 29.6% in 2023 to 28.9% in 2027.