The Draghi government does not hide its irritation at the ECB's communication errors which caused the collapse of the stock market and above all of bank stocks and the rise of the Btp-Bund spread to levels not known for some time. But Draghi wants to respond to the Lagarde incident who was unable to convince the markets on the anti-spread network with facts and with a plan which, without budgetary deviations, aims to strengthen the wages of the weaker groups by temporarily cutting the tax wedge and reducing the difference between gross pay and net pay until at least the end of 2022.
Wages: wedge cut until the end of the year to defend the weakest
The plan that Draghi has in mind envisages doubling the contribution discount, already introduced by the latest budget law, for 13,8 million Italians, i.e. those who have an annual gross income from work of less than 35 euros, extending it up to end of the current year with a total annual benefit of 223 euros each, to which, however, we must also add the one-off bonus of 200 euros which will start in July, in addition to the discounts on electricity and gas bills and on excise duties on petrol that the Government plans to extend. The measure on which the Government is working aims to raise the contribution relief from 0,8 to 1,6% with an additional expenditure for the Treasury of 750 million euros for six months.
In total the social security rebates and other anti-inflation measures (between bonuses, bills and petrol) should cost the Treasury between 6 and 9 billion and be financed mainly by the extra VAT deriving from the increases without forgetting the possibility of drawing on the extra profits on energy companies, even if the provision is at risk of being unconstitutional . Certainly Draghi wants to meet the needs of the weakest sections of the population but without aggravating the public budget, which will be weighed down by the higher cost of interest on the debt.
We are in the field of emergency interventions while the more structural ones will be discussed on the occasion of the new budget law of September, politics and electoral fibrillation permitting.
