The budget for 2014 has been approved by the Italian government on 15 October 2013 aiming on spending and tax cuts at Italy’s economy to growth and bringing it under the EU budget deficit ceiling.
The budget includes “a significant cutback in taxes for families, workers and businesses” The Prime Minister added. He also added that budget deficit of Italy would reach 2.5 percent of GDP by 2014 which will be below the EU ceiling of 3 percent and with reductions in its inflexibly high public debt in each of the next three years.
The cut of tax for the budget would be14.6 billion euros ($19.7 billion) from 2014-2016, of which 5.6 billion Euros for businesses and 5 billion euros for workers.
The corporate tax measures include an opportunity for companies to revalue their tangible and intangible assets as at the end of the accounting period that spans 31 December 2013. Companies taking advantage of this opportunity must however pay a substitute tax of 16% for depreciable or amortizable assets or 12% for non-depreciable assets.
The Finance Minister commented that the budget “reinforces the potential for economic growth and stimulates the recovery”.
Economists are doubtful that the Italian economic recovery will start this year, although there have been some encouraging signs like an increase in exports. Italy has been in recession since mid-2011, which resulted in the economy hovering just around its level of a decade ago.
