The 2017 Budget bill has been approved

The Council of Ministers approved the State budget bill for the fiscal year 2017 and for the three-year period 2017-2019. A variety of changes have been introduced in terms of labour law. In particular, it was announced that the taxation limit for the productivity bonus with a 10% tax flat rate will increase in 2017 from the current 2,000 Euros to 3,000 Euros and in case of equal involvement of employees in the organisation of work, the current limit of 2,500 Euros will increase to 4,000 Euros. Workers, clerks, executives and non-senior managers will benefit from it with an increase in the gross income limit that will allow them to take advantage of a reduced tax rate from the current 50,000 Euros to 80,000 Euros per year. In respect to pensions, among others, three types of early retirement programs (the so called APE) were established: (i) social APE addressed to certain categories of employees, and charged to the State; (ii) voluntary APE addressed to employees who decide to retire up to 3 years and 7 months before the legal pension requirements and (iii) corporate APE called for by businesses committed to a restructuring plan whose costs are charged to the businesses. The contribution exemption for young and unemployed people was reintroduced into this Budget bill.