ROME (AP) — Italy’s far-right government has approved a budget of about 30 billion euros ($33 billion) for next year that officials say will be partly financed by a levy on Italian banks and insurers.
Prime Minister Giorgia Meloni said late on Tuesday that the government expects to raise around 3.5 billion euros from banks and insurance companies to ensure better public services, especially the country’s struggling healthcare system, and help its most vulnerable citizens.
“As we promised, there will be no new taxes on citizens,” Meloni wrote in a post on X.
The 2025 budget law was approved by ministers at a cabinet meeting late Tuesday, just in time to meet a deadline to submit the plan to the European Union. The measures still need to be approved by the Italian parliament, with a final vote expected by the end of the year.
Economy and Finance Minister Giancarlo Giorgetti had been under intense pressure for weeks to reconcile the need to reduce Italy’s budget deficits – closely watched by the EU – with the government’s expensive election promises.
“Someone would call it an extra profit (tax), I call it a sacrifice,” Giorgetti said at a press conference on Wednesday, commenting on the new levy on banks and insurers.
Government officials have not released details about the new financial charge. But some Italian media reported it would focus on temporarily eliminating deductions for lenders’ so-called deferred tax assets and raising taxes on bankers’ stock options.
The minister revised an earlier plan by the right-wing government, which has repeatedly criticized banks for profiting excessively from higher interest rates.
An initial attempt to target lenders with a 40% windfall tax failed last year after the move led to a major sell-off in Italian banking shares, forcing the government to withdraw the plan.
Deputy Prime Minister Antonio Tajani said in a message on X that the banks’ new contribution “will not frighten the markets.”
Giorgetti said on Wednesday that additional resources will also come from a “spending review” imposed on Italian ministries, which have been asked to tighten their belts and propose cuts.
The 2025 budget also includes permanent cuts in income taxes and social contributions for middle and low income earners, one of Meloni’s key electoral promises.
To finance the new package of measures, Italy will increase its deficit next year from an estimated 2.9% to 3.3% of gross domestic product.
Rome is under pressure to keep its accounts under control after being placed under special surveillance by Brussels for running deficits far exceeding the EU’s 3% limit and for its massive debt burden, which now stands at almost €3 trillion. did not return.