In Official Journal no. 304 dated 30 December 2019, Law no. 160 of 27 December 2019 was published. “Budget Law 2020“, in force since 1 January 2020.
There is a great deal of news relating to labour and social security.
News relating to labour and social security.
One of the main innovations characterising the 2020 Manoeuvre concerns the reduction of the so-called “tax wedge” on employees. A comprehensive reform of the IRPEF (Personal Income Tax) regime is inaugurated through a progressive plan to reduce payroll taxation, which will produce its first effects, in economic terms, as of July 2020. In parallel and in support of this reform, the establishment of a Fund for the reduction of the tax burden on employees with a budget of €3 billion for 2020 and €5 billion from 2121 onwards has been provided for.
Having said that, it is expected, with certainty, that the details of the bonuses granted to employees and the possibility for companies to review the amount of taxation on labour will become known. The text of the 2020 Budget Law, in fact, refers to the adoption of a subsequent implementing decree to regulate the operational aspects of the Manoeuvre.
Amongst the changes made, there are new tax exemption thresholds for “meal vouchers” which introduce a daily non-taxable limit of €8 for electronic meal vouchers and €4 for those in paper format. In order to take advantage of the tax relief introduced, meal vouchers must be intended for employees and collaborators whose remuneration is included in the income from employment or, in any case, assimilated.
Furthermore, with the entry into force of the new measure, funding for “Industry 4.0” is confirmed with the condition precedent that the activities implemented must ensure environmental sustainability. Amongst the novelties contained in the package of measures are the interventions in support of start-ups and small- and medium-sized enterprises, provided that they are innovative.
The “2020 Recruitment Bonus” is reconfirmed to support the re-launch of employment of young people aged up to 35 years. Employers that, as of 1 January 2020, will hire young people under the age of 35 under an open-ended contract will be able to benefit from a tax break. This benefit provides for the payment of 50% of the mandatory INPS (social security) contributions for the first 3 years of the contract and, in any case, up to a maximum amount of €3,000 per year of tax relief. All employers, regardless of the region in which they are based, will be able to take advantage of this innovation.
For employers in the South of Italy, on the other hand, the bonus increases to 100% relief on compulsory contributions for the first 3 years of the term of the contract term (the so-called “2020 South Recruitment Bonus“).
In both cases, the condition remains that, for the first 6 months of activity, the hired young person cannot be dismissed.
News in the field of social security As regards social security, on the other hand, (i) the “Quota 100” Reform is confirmed for the whole of 2020 and until 31 December 2021; (ii) the financial subsidy that leads to retirement is renewed for those categories of workers who need greater protection, the so-called “Social APE” and (iii) the so-called “Women’s Option“, which provides for the possibility for public and private workers to anticipate their retirement also for 2020, is extended.