Italian parliament gives final approval to government’s 2024 budget

ROME (Reuters) – The Italian Chamber of Deputies on Friday passed the government’s tax-cutting 2024 budget, giving parliament’s final approval to the package which becomes law just ahead of an end-year deadline.

Prime Minister Giorgia Meloni’s second budget drives up next year’s fiscal deficit to 4.3% of gross domestic product (GDP) from 3.6% forecast in September, allocating almost 16 billion euros ($17.60 billion) in tax cuts and increased spending.

Rome’s 2.4 trillion euro public debt, proportionally the second largest in the euro zone, is targeted to remain virtually stable next year at 140.1% of GDP, compared with 140.2% in 2023.

The rightwing government won the vote after a second reading in the lower house by 200 to 112.

The budget, presented by Meloni in mid-October, was approved by the upper house Senate last week.

One of the measures most touted by Meloni is an extension to 2024 of temporary cuts to welfare contributions paid by companies and workers, in a move aimed at increasing the take-home pay of middle and low-income workers.

The budget also marginally raises the retirement age, increases spending to fund the health service and renew public sector contracts, and creates a life insurance guarantee fund to protect policy holders and avoid cases similar to Eurovita.

The company this year became the first Italian insurer to be placed under special administration after high interest rates and a drop in the value of bonds led savers to redeem their policies, draining its capital reserves.

Another new measure introduced in the financial law requires companies operating in Italy to take up insurance to cover damage caused by increasingly frequent natural disasters.

($1 = 0.9038 euros)

(Reporting by Angelo Amante and Gavin Jones)