Italy: It Will Not Reach EU deficit target 3% By At least 2026

It will take at least 2026 to reduce its budget to 3% of the European Union (EU), according to Bloomberg sources, potentially causing increased control by the Union’s budgetary bodies. With the deficit at 7.2% of GDP last year due to tax relief for house renovations, the Italian government will take several years to restore its public finances to a sustainable course, according to Bloomberg. The government has planned to unveil new economic goals and forecasts shortly, with the Treasury expecting growth of 1% this year, well above economists’ estimates of 0.6%. Sizes may change before the announcement. This faster expansion will help reduce the deficit to around 4.4% this year and below 4% next year, US media information says. A possible target 4.3% was reported earlier Wednesday by the newspaper Il Sole 24 Ore. Finance Minister Giancarlo Giorgetti has repeatedly assured that Italy’s public finances remain “an absolute priority”. Giorgetti had to explain a number of revisions to Italy’s deficit forecasts since taking office in 2022, after a formal reassessment of how tax reliefs will be taken into account, including “superbons”. This decision allowed homeowners to earn an additional 10% over the amount they had spent on renovations and quickly escaped control. In recent months, the government of Meloni has drastically reduced tax relief, reducing maximum costs.