Meloni Focused on Tax Cuts Over Italy’s Falling Birth Rate in 2024

2 mins read
October 18, 2023
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As Italy confronts an impending demographic crisis and a collapsing birth rate, anticipation builds around its 2024 budget. Prime Minister Giorgia Meloni, a proponent of ‘traditional’ families, is widely expected to infuse policies championing these values. Yet, initial insights into the budget reveal a discernible shift towards economic restructuring, seemingly sidelining crucial family support initiatives.

The Stakes:

Italy’s swiftly aging demographic and plummeting birth rates aren’t just societal concerns but economic red flags. With experts predicting a potential 20% decrease in Italy’s population by 2050, does the budget’s current trajectory hint at strategic misjudgment?

A Deeper Dive into Demographics:

Budgetary Bias: Economic Resilience over Family Support?

Despite Meloni’s emphasis on her identity as a “Christian mother,” the budgetary indications appear incongruent.

  • Tax Reforms in the Limelight: The budget proposal compresses tax brackets from four to three. Although this provides some relief, especially for the higher income strata, the initiative carries a €4.1 billion cost.
  • More Tax Breaks: A significant budgetary section zeroes in on the ‘tax wedge’, focusing on diminishing payroll tax contributions— a maneuver primarily benefitting the well-off.
  • Healthcare Controversies: The proposed budget contains contentious elements, such as levying additional fees on non-EU residents utilizing public health services.

Family-Centric Policies: Secondary or Sidelined?

Family initiatives find mention but seem overshadowed in the grander budgetary narrative.

  • Tax Reliefs over Tangible Support: Plans like exempting social security contributions for women with two children are not novel. Countries like the Conservative Hungary championed tax incentives. Still, they provided direct cash assistance and other subsidies starting with, not excluding, the first child and ramp-up
  • Childcare Conundrums: Meloni has pitched free nursery education for the second child. However, intricate details are yet to emerge. Given many Italian couples halt at one child primarily due to economic constraints, starting these benefits from the first child could have delivered tangible support and immediate relief. Meloni’s intent to “undo the story that having children is a disincentive to work” juxtaposes her seemingly simplistic approach to childcare issues.

Future Forecast:

The finalized budget will undoubtedly draw intense scrutiny. With an evident emphasis on tax reforms, the sidelining of family-centric policies is palpable. The looming question: Will the definitive budget sway towards bolstering families?

The Bottom Line:

It’s just growing clear that Meloni treats family policy as an afterthought at best, forced to deal with it because it has harmed the Italian economy for decades. At worst, Meloni uses the Italian family as a virtue signal to justify passing additional tax benefits for those who have already achieved their fertility intention and other policies that don’t help most Italian couples get their first child, let alone second.

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