The new fiscal program that will be approved by the Cabinet on September 29 will also see an unexpected reduction in debt compared to 2020. In the black year of the pandemic, public debt rose to 155.8% of GDP, a document from Economy and Finance forecast in April another increase this year to 159.8%; Today, the budget modernization framework will record a change of course of about 154%. With a decrease of about two points compared to last year: another unprecedented dynamic, which today can be demanded by Prime Minister Mario Draghi and Minister of Economy Daniele Franco at the press conference expected at the end of the government meeting.
To crush debt, combined with an economy growing at 6% versus the 4.5% target (and 4.1% trend) written in the deficit in April, there is a much smaller deficit than expected: 9, 5%, he explained on September 28 in the control room. by the top executive, versus 11.8% calculated in April.
Income is better than expected
At the base of these figures there is a better than expected inflow of tax revenue and actual arrival of the first recovery funds, which do not affect the debt for the support part; These two trends are added to the fact that spending on major emergency interventions, first of all non-reimbursable aid, has stalled before the figures calculated to finance the two “support” decisions. But there is also a final decision not to allocate a significant share of the fiscal space open through growth to the tax ordinance.
Additions coming soon
This action will accompany Nadef to Cabinet today September 29, but it will mainly focus on a series of extensions: there should be an additional month for retroactive applications for a single check, and a new additional time for companies that have to pay “IRAP” suspended in 2020 after exceeding EU limits on state aid and intervention to allow municipalities to certify digital signatures collected for the cannabis referendum. On the other hand, the most important financial measures in terms of public accounts have to intervene later.
The government’s decision, which will be detailed in the program under approval, is actually to distribute a share of the growth impact over the next three years, without jeopardizing the debt trajectory in the coming years which will have to decline at a much steeper rate to achieve the main objective of Restoring credibility to our public accounts on the international stage.
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