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Italy Economic Impact of Covid-19

The Government of Italy (GOI) approved a new Decree on measures to counter  the  impact of Covid-19 on the Italian economy.  Overall GOI spending for the decree will amount to €25 billion, to be raised through bond issuance.  Here are the highlights of the Decree:

  • €3.5 billion will be destined to the national healthcare system and disaster relief
  • €10 billion for worker relief measures, including the extension of wage guarantees to companies which would have normally not benefited from those measures, such as micro enterprises employing 5 or less, agricultural workers, seasonal workers and others
  • Suspension of mortgage payments for first home purchases for subjects at risk
  • Classification of quarantine as sick leave for compensation purposes
  • €500 allowance for certain categories of self-employed workers
  • Deferral of tax payments until 5/31/2020 for companies hardest hit by Covid-19 (such as restaurants, gyms, cultural institutions and more)
  • Government financing of loans to SMEs
  • Allowances for low income workers whose activities were terminated or reduced because of Covid-19
  • Monetary or comp time allowances for parents of children forced to stay at home because of school closings; alternatively, vouchers for babysitting can be claimed
  • Financing for companies manufacturing personal protection and medical instruments needed to face the Covid-19 crisis (e.g. masks)
  • Retribution to certain tax-exempt individuals of the work they had to perform in the workplace during the month of March 2020
  • Tax credits for shopkeepers for the month of March 2020
  • Financing of overtime sustained by doctors and nurses dealing with the Covid-19 emergency
  • €50 million in tax credits for companies’ sanitizing expenses
  • Smart working as the norm for public sector workers, or alternatively paid leave
  • Nationalization of air carrier Alitalia, to be managed by a company entirely controlled by the Ministry of Economics and Finance.  €600 million to be destined to the air transport sector to mitigate the damages caused by Covid-19

(Corriere Economia, March 16 2020)

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