Tax reform 2023: latest news

Tax reform 2023: What it provides

Many new developments are expected to arrive with the 2023 tax reform, foreseen by the Government’s Delegation Law Draft.

The reform aims to simplify the tax system, improve collection and reduce the tax burden on taxpayers. It provides for the reduction of the IRPEF and the extension of the incremental flat tax, the simplification of deductions, the cutting of the so-called «tax expenditures» and a greater fight against tax evasion.

The main objective communicated by the promoters of the law is to encourage the country’s economic growth, lower the tax burden on taxpayers and businesses and simplify the current bureaucracy. With this reform the aim is to adapt national tax law to that of the European Union and modify the tax assessment, collection and sanctioning mechanisms, guaranteeing greater flexibility for taxpayers. Furthermore, it also provides for the modification of the IRPEF, the extension of the incremental flat tax to all employees, a peculiar regime that incentivizes the increase in income and the simplification of tax deductions.

The main points in detail

Here is what the tax reform provides in detail:

• Review of personal income taxation through a reduction of IRPEF rates on three income brackets and a review of the taxation system;
• Extension of the incremental flat tax to everyone, including employees;
• Simplification of tax deductions through a cut to IRPEF deductions and other bonuses, with a compensation that varies depending on the income bracket to be able to deduct expenses;
• Review of corporate income tax, divided into two rates, an ordinary one of 24% and a reduced one to 15% for the portion of income destined for qualified investments and/or new employment;
• Gradual abolition of IRAP and the introduction of a surtax with a tax base corresponding to the IRES one;
• Fight against tax evasion through more refined analysis tools offered by Artificial Intelligence and dematerialization and digitalization of processes to streamline timescales and reduce obligations for taxpayers.

In conclusion, the way in which the first degree tax justice courts and the detached sections of the second degree tax justice courts are organized is redefined, through the merger of the existing offices based on factors such as the size of the territory, the workload, the number of inhabitants, the tax authorities and the collection.

We will see in the coming weeks what the definitive text will be.