Numerous appeals by Italian industrial and commercial associations have been at least partially successful: Italy’s cabinet was unable to agree on a consensus for the 2021 budget, which ultimately led to the likely postponement of the new taxes on disposable plastic products and sweetened beverages (see Plasteurope.com of 15.10.2020). Both were previously scheduled to go into effect on 1 January 2021, but now the new levies are scheduled for 1 July 2021. This would be the second postponement of a tax originally passed in January 2020.

In particular, the rigid attitude of members of the “Italia Viva” party caused the postponement. According to information from the Italian media, the Italia Viva members stated that, in view of the already difficult situation of companies and the population at present, they would not, under any circumstances, approve the budget as long as it contained the two taxes. The delay is a negotiated compromise, as Italy cannot afford to completely abandon approaches like the plastic tax. The budget plan still has to pass through the EU institutions in Brussels, a step likely to become all the more difficult if the country shows a lack of will for implementing the sustainable transformation laid out in the EU’s “Green Deal”.

Italian tax coffers should feel little effect from the compromise. Compared to their public perception and the resistance in the population, both taxes are relatively insignificant financially. According to the latest figures, the levies are expected to generate annual revenue of around EUR 780m, with EUR 520m coming from the plastic tax. The latest Italian budget plans include EUR 40 bn in state aid for the economy alone.