INPS: Extend the ‘Valore nuovi nati’ Fund to families with minor children born before 2027
The Institute’s Director-General, Valeria Vittimberga, proposed during a hearing on the budget that, in addition to the deduction currently provided for, it should be possible to deduct contributions made by family members, as is the case with supplementary pension schemes
Key points
- An estimated 356,000 new registrations of newborns per year
- Additional contributions made by family members are tax-deductible at 19 per cent up to 1,000 euros per year
- A decree from the Ministry of Labour and the Ministry of Economy and Finance will set out the options for buying back pension contributions
- Clarification sought from experts regarding adopted children
Extend the ‘Valore nuovi nati’ Fund to families with minor children born before 2027, and, in addition to the tax relief currently provided for, allow contributions to be deducted, as is the case with supplementary pension schemes (up to a limit of 5,300 euros).
An estimated 356,000 new births are recorded each year
During a hearing before the Chamber of Deputies’ Budget Committee on the 2027 Budget Bill, the Director-General of INPS, Valeria Vittimberga, put forward these two proposals to strengthen the scope of the Fund established by the Budget Law within the National Social Security Institute. For every child born on or after 1 January 2027, INPS will set up an individual account in the child’s name, credited with €100 per year paid by the State and transferable to a supplementary pension scheme upon reaching the age of 18, and will notify the parents or those exercising parental responsibility. As Vittimberga explained, within three months of each birth, the Institute will be required to open the account (estimated at around 356,000 per year), collect additional contributions from families, maintain individual accounts and, from 2045, manage the transfer to the funds.
Parents, relatives up to the third degree and relatives by marriage up to the second degree may contribute to the funding of the scheme through voluntary payments. The financial management of the resources is entrusted to Cassa Depositi e Prestiti in accordance with prudent criteria: ‘Over time, the Fund may accumulate significant resources which, in accordance with the prudential criteria laid down by the legislation,’ added the Director-General of INPS, ‘could also be channelled into long-term investments in the country’s real economy. This is a key aspect of the measure, which is currently under-emphasised in the debate, combining social security protection for the younger generations with support for growth.”
Additional contributions made by family members are tax-deductible at 19 per cent up to 1,000 euros per year
The provision in the Budget Act stipulates that additional contributions made by family members are tax-deductible at a rate of 19 per cent up to 1,000 euros per year. According to the INPS Directorate-General, in order to ‘further expand participation in the Fund, consideration could be given to combining the tax relief with the option to deduct contributions, in line with the supplementary pension scheme into which the Fund is set to be integrated’, a measure of this kind ‘could encourage families to allocate a larger proportion of their savings to the Fund, thereby strengthening the build-up of pension capital for their children from birth’.
The other proposal put forward by Vittimberga concerns ‘families with minor children born before’ 2027 who ‘might have the same interest in building up long-term savings for them. These families could also be allowed to open an account and make voluntary contributions, benefiting from the same tax relief, even without the €100 public subsidy’. The cost to the public purse would be limited to the tax relief, with a reduction in revenue estimated by INPS at around 45 million euros from 2028, falling to zero from 2046 onwards. ‘This would, for example, avoid inequality between siblings born before and after 2027,’ notes Vittimberga.
