Draft 2027 Budget Cuts Tax for Some High Earners and Extends Parental Leave

Italy's draft budget for 2027 contains a cut to income tax for some higher earners and an extension of the parental leave allowance, according to The Local Italy's reading of the draft published on Friday. The same analysis picks out eight measures in the text that bear directly on foreign residents, of which these two are the most likely to change a payroll calculation. The coverage gives no rates, no thresholds and no costing for either.

Milan is where a change to higher-rate income tax is felt first in Italy. The city and its hinterland hold the headquarters, the banks and the corporate functions that pay the salaries in question, and the foreign managers a multinational posts to Lombardy read a budget through exactly these lines. A cut aimed at better-paid taxpayers works, in that sense, as a recruitment document as much as a fiscal one.

The parental leave measure points at a different problem. A low birth rate and the steady emigration of young Italians are the backdrop foreign coverage returns to whenever it examines the country's workforce, and leave entitlements are one of the levers a government uses to keep parents attached to employment. The wire gives no indication of how long the extension runs or how it would be funded.