Italy's Ruling Coalition Fractures Over Superbonus and Sugar Tax Reforms

Italy - Ekhbary News Agency

Italy's Ruling Coalition in Turmoil: Superbonus and Sugar Tax Ignite Internal Strife

A fierce internal conflict is gripping Italy's ruling coalition, exposing deep fissures over highly contentious government proposals concerning the 'Superbonus' decree and the reintroduction of the 'Sugar Tax'. The debate has intensified, leading to public clashes between key alliance partners, particularly Forza Italia and the League, and raising questions about the stability of Prime Minister Giorgia Meloni's administration.

At the heart of the Superbonus dispute are amendments introduced by the government, signed by Economy Minister Giancarlo Giorgetti, which propose significant retroactive changes to the popular building renovation incentive. Specifically, the tax deduction period is set to extend from four to ten years for expenses incurred from the beginning of 2024. Forza Italia has vehemently opposed this retroactivity, with party spokesperson Raffaele Nevi stating that 'retroactive norms affect the credibility of the State and its capacity to attract investments.' Nevi emphasized that while the party understands the 'enormous problem of the Superbonus,' its liberal vision compels it to 'raise doubts about a measure that retroactively impacts programs and resources committed based on a different norm.'

Senator Maurizio Gasparri of Forza Italia echoed these sentiments, stressing the importance of respecting the legal principle of non-retroactivity and calling for an internal discussion within the majority and with the government. This stance, however, drew a sharp rebuke from the League's Senator Massimiliano Garavaglia, who criticized Deputy Prime Minister Antonio Tajani (Forza Italia leader) for 'incomprehensible attacks on the executive.' Garavaglia insisted that the amendment is a government initiative, not solely from the Ministry of Economy and Finance (MEF), and urged Tajani to clarify his position with Prime Minister Meloni. Such public exchanges underscore the growing tensions within the coalition.

Adding to the friction is the 'Sugar Tax,' another fiscal measure causing significant disagreement among the allies. The government's amendment proposes the implementation of the tax on non-alcoholic beverages starting July 1st, albeit at a halved rate, while postponing the 'Plastic Tax' for another two years. Both taxes were originally established in the 2020 Budget Law but have faced repeated delays. Forza Italia, 'always opposed to this type of tax,' is prepared to join industry associations and businesses in the sector, who condemn the levy as 'unfair and vexatious.' Gasparri recalled that the Sugar Tax had consistently been discussed with the aim of postponement, a decision formally endorsed by a parliamentary motion.

Industry associations such as Assobibe and Italgrob have urged the government to reconsider, warning of 'negative effects from agricultural activities to distribution and commerce, and very heavy negative repercussions on the sector,' particularly as the summer season approaches. Giangiacomo Pierini, President of Assobibe, highlighted that 64% of the already contracting sector comprises small businesses, arguing that 'adding a tax means hitting it even further.' The Uila-Uil trade union also expressed concern for the 5,000 workers in the sector, calling for urgent government intervention.

Opposition parties have seized upon the internal strife to criticize the government's economic policies. The Democratic Party (PD) suggested that 'if Giorgetti is not capable of being a minister, he should leave.' Angelo Bonelli of the Green and Left Alliance (Avs) pointed out that 'the minister eliminates eco-bonuses but leaves energy and bank extra-profits intact, about 80 billion in 2 years: this is an attack on the economy and the middle class.' These broadsides further complicate the political landscape for Meloni's government, which must navigate these internal and external pressures while striving for fiscal stability.

Ekhbary News Agency