Messina and Meloni clash over 'South American-style' budget tax credits

The hearing and the criticism

Carlo Messina, chief executive of Intesa Sanpaolo, told a parliamentary hearing on Thursday, 12 November, that spreading superbonus tax credits over ten years in the 2027 budget bill was a 'South American-style' way of managing debt owed to creditors. He called the plan simply unbelievable, said a credit he holds that matures next year was being pushed out to ten years with no interest, and warned that the change could raise asset-classification problems under ECB rules. He also asked why the measure had not been discussed beforehand so that alternative liquidity solutions could be found, and faulted the government for not consulting experts while preparing the budget.

Meloni's reply and the clarification

Meloni answered reporters in Dublin and said she regretted that the measures were being described as South American-style.

“I regret that these are being characterized as 'South American-style' measures; I don't believe they are.”

She added that she would have preferred to reach the same outcome through an agreement, as in previous years, and said the contribution asked of banks was 'a matter of fairness'. In a separate remark, she said some businesses in Italy had done well in these years partly thanks to government measures and the stability the country had guaranteed.

On Thursday, Palazzo Chigi clarified that Meloni had understood Messina's criticism as aimed at the whole budget and at banking measures. It said she had not realised he was referring to the restructuring of superbonus tax credits, and that had she understood, she would not have described the choice as 'a matter of fairness', since it was a specific policy decision.

Bank tax rise and sovereign debt

The Financial Times reported that the government has proposed raising the corporate income tax rate on banks to 30.5% next year from 27.5%, which would bring around 7 billion euros of additional revenue from lenders through 2029.

Rate before the proposal27.5%

Proposed for 202730.5%

Rate before the proposal

27.5 %

Proposed for 2027

30.5 %

Data from the article text

Messina accused the government of trying to 'bully' banks while it looks for money to finance populist measures ahead of next year's general elections.

Messina said Italian banks, which he described as the country's 'primary creditor', had so far resisted pressure to reduce their concentration in Italian government bonds. The FT cited ECB data showing Italian sovereign bonds made up more than 15% of local lenders' total assets at the start of this year. Messina warned that the banks could reconsider holding such large stocks if the tax changes went ahead, and that some sovereign debt could be reclassified as riskier.

Bank tax increases already imposed15

Extra bank revenue through 2029 (proposal)7

Tax credits spread over 10 years20

Bank tax increases already imposed

15 €bn

Extra bank revenue through 2029 (proposal)

7 €bn

Tax credits spread over 10 years

20 €bn

Data from the article text

He said:

“We have never complained about the significant capital losses in our portfolio resulting from the government bonds we subscribe to.”

Economy Ministry response

Economy Minister Giancarlo Giorgetti rejected the accusation at a hearing before the joint budget committees of the Chamber and the Senate. He pointed to what he called the Habsburg policy of the past four years in managing public accounts, and said the state had taken on the impact of the building bonuses. Giorgetti said the levy on banks and insurers was not meant to weaken their capital strength but was needed to keep public finances in balance.

Rai reported that Abi estimates the new measures carry about 7 billion euros of extra costs over the next three years, bringing the total of bank measures adopted over several years to nearly 22 billion euros.

Next steps

The ministry said it was open to considering amendments during the parliamentary process, but that the budget's core pillars would not be touched and any change would need adequate financial cover. Messina has raised the possibility of a challenge before the Constitutional Court, which Rai reported as a threat, and he has called the ten-year spread unconstitutional.