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    Home > Headlines > Italy's 2026 budget entails tax cuts and spending hike worth 18.7 billion euros
    Headlines

    Italy's 2026 budget entails tax cuts and spending hike worth 18.7 billion euros

    Published by Global Banking & Finance Review®

    Posted on October 17, 2025

    1 min read

    Last updated: January 21, 2026

    Italy's 2026 budget entails tax cuts and spending hike worth 18.7 billion euros - Headlines news and analysis from Global Banking & Finance Review
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    Tags:GDPGovernment fundingtax administrationfinancial marketspublic policy

    Quick Summary

    Italy's 2026 budget proposes €18.7 billion in tax cuts and spending hikes, focusing on defense and welfare, awaiting parliamentary approval.

    Table of Contents

    • Overview of Italy's 2026 Budget
    • Tax Cuts and Spending Increases
    • EU Escape Clause Considerations
    • Welfare Spending Protection

    Italy's 2026 Budget Features €18.7 Billion in Tax Cuts and Spending Increases

    Overview of Italy's 2026 Budget

    ROME (Reuters) -Italy's 2026 budget contains tax cuts and spending hikes worth 18.7 billion euros ($21.86 billion), Prime Minister Giorgia Meloni said on Friday.

    Tax Cuts and Spending Increases

    The government will assess tapping an EU escape clause aimed at boosting defence spending, and will avoid cutting welfare spending, Meloni told reporters after the cabinet approved the budget law that will now be presented to parliament for approval by year-end.

    EU Escape Clause Considerations

    ($1 = 0.8555 euros)

    Welfare Spending Protection

    (Reporting by Giuseppe Fonte, wrinting by Claudia Cristoferi, editing Gavin Jones)

    Key Takeaways

    • •Italy's 2026 budget includes €18.7 billion in tax cuts and spending hikes.
    • •The budget aims to boost defense spending through an EU escape clause.
    • •Welfare spending will not be reduced.
    • •Prime Minister Giorgia Meloni announced the budget details.
    • •The budget law awaits parliamentary approval by year-end.

    Frequently Asked Questions about Italy's 2026 budget entails tax cuts and spending hike worth 18.7 billion euros

    1What are tax cuts?

    Tax cuts refer to a reduction in the amount of tax that individuals or businesses are required to pay, often aimed at stimulating economic growth and increasing disposable income.

    2What is the EU escape clause?

    The EU escape clause allows member states to temporarily deviate from certain fiscal rules in order to address exceptional circumstances, such as increased spending for defense or economic recovery.

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