The 2015 Stability Law: impacts on Tuscany

By and large, the 2015 Stability Law has been welcomed as a considerable break from the interventions of previous governments, as it introduces measures to recover the economy within a rigid framework of public finance constrains. In this direction, the most significant actions at local level concern: 1. the confirmation of the 80-euro monthly bonus on the personal income tax (IRPEF) for workers with incomes below 26,000 Euros; 2. the reduction of the regional tax on productive activities (IRAP) for the share relative to labour cost; 3. the imposition of new financial constraints to regional budgets (from the expenditure ceiling to the balance compliance), as well as a 4-billion reduction of spending power; 4. the reduction of the spending power of provinces and metropolitan cities, and related effects on the process of institutional reorganization; the reduction of personnel; 5. the loosening of the goals set for municipalities by the internal stability pact, which will be partly offset by the introduction of harmonised accounting standards that also impact on the pact itself; (bad debt loans). It should be noted how financially-stringent measures are coupled with interventions in accounting (for municipalities, provinces and regions) and personnel matters (for the provinces alone). These constitute additional constraints that will limit the capacity for action of these bodies. This paper illustrates the main implications of the Stability Law for Tuscan local authorities as well as for families and firms.