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UPDATE: Who can claim Italy’s €200 cost of living bonus?

The Italian government will soon start making the first of its €200 payments intended to offset the rising cost of living. But who will be eligible, and what do you need to do to claim? Here's the latest official information.

UPDATE: Who can claim Italy's €200 cost of living bonus?
A worker mans a tractor cleaning a private beach in Fregene, northwest of Rome. Here's how workers can access the €200 cost of living bonus. (Photo by FILIPPO MONTEFORTE / AFP)

Italian authorities have confirmed the one-off ‘bonus’ payment of €200 will be made to some 30 million people in June and July.

The payments were announced in May alongside other government measures aimed at offsetting the soaring cost of living, such as extending energy bill discounts and rolling on the deadline to claim Italy’s popular ‘superbonus 110’.

Employees, as well as the self-employed, pensioners and the unemployed, will be eligible to receive the €200 payment if they have an annual income of under €35,000 gross, according to a decree law passed in May.

But since the initial announcement there has been widespread confusion about how people can access the bonus.

Things became clearer for some this week after Italy’s social security and pensions agency (INPS or the Istituto nazionale della previdenza sociale) released guidelines on claiming the bonus – so far, for those in employment, pensioners and certain types of part-time workers.

READ ALSO: The rules and deadlines for filing Italian taxes in 2022

The bonus will also be available to the self-employed, seasonal and domestic workers, the unemployed, and those receiving Italy’s ‘citizen’s income’ benefit.

Still to be defined, however, is how people in these categories will be able to claim. More information is expected to be published in a separate government decree.

Based on the current INPS guidance, here’s what we know so far:

How do you claim?

If you’re a state employee or a pensioner, the payment will be made automatically – those entitled to the bonus will be identified by the Ministry of Economy and Finance and INPS.

If you work in the private sector, the €200 should be included in your July pay packet (or June as the case may be: see below) and the paperwork will be handled by the employer.

All other categories, including the self-employed and professionals registered with INPS, still have no instructions on how to apply for the bonus. A decree or other further guidance is expected to be published in the coming weeks.

Certain part-time workers or those with particular employment relationships, such as jobs that entail working in June but not July, will receive the funds early to account for not receiving a pay check in July.

INPS also stipulated that for the bonus to be paid, the employment relationship must exist in July 2022. It’s not yet clear what that means for employees on contracts that cease to exist from July 1st.

The Local will continue to provide updates on this when details are released.

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MONEY

EXPLAINED: Why people in Italy might have to carry more cash from now on

Italian retailers will no longer face fines for refusing card payments on amounts lower than €60, after the government put the brakes on a recent push towards electronic payments.

EXPLAINED: Why people in Italy might have to carry more cash from now on

Italy’s new budget bill is set to add yet another controversial chapter to the country’s long and troubled history of card payment laws.

Under Italy’s new budget law, retailers will no longer be fined for refusing card payments for smaller amounts – a controversial move that is expected to have a knock-on effect for shoppers.

READ ALSO: Key points: What Italy’s new budget law means for you 

Fines for retailers refusing card payments on amounts lower than €60 will now be suspended until at least June 2023, according to a clause included in the text of the 2023 budget law published to media on Wednesday.

As set out by the bill, the six-month suspension will allow the newly created Ministry of Enterprises and Made in Italy to “establish new exemption criteria” and “guarantee the proportionality of the given penalties”.

And, though it isn’t yet clear what new exemptions the government is currently considering nor what exactly is meant by “proportionality”, what’s certain is that residents who had started to make more purchases by card will now have to repopulate their pockets with some good old banknotes because businesses – from taxi drivers to cafes and bars – might not accept card payments for small amounts.

Fines for businesses caught refusing card payments had been introduced by Draghi’s administration back in June 2022, with retailers liable to pay “a €30 administrative fee plus four percent of the value of the transaction previously denied”, regardless of the amount owed by the customer. 

Euro banknotes in a wallet

Under Italy’s new budget law, retailers will no longer be forced to accept card payments for transactions under €60. Photo by Ina FASSBENDER / AFP

The measure angered retailers who lamented having to pay hefty bank commissions on every electronic transaction – some business owners even went as far as openly defying the law and organised themselves into a protest group (Comitato No Pos, roughly meaning ‘Anti-point-of-sale committee’). 

Given the government’s new legislation, it seems like their efforts might just have paid off. 

But, while many business owners will no doubt be happy with the suspension, others have already raised doubts about the potential ripple effects of the government’s move.

Aside from shoppers having to carry more cash than they’re currently used to, many political commentators are warning that the suspension might be a “gift to tax dodgers” in a country where, according to the latest available estimates, tax evasion costs state coffers nearly €90 billion a year.

The same was said about another of the government’s recent changes: raising the cash payment limit from 2,000 to 5,000 euros.

READ ALSO: What’s changing under Italy’s post-pandemic recovery plan? 

A previous government led by Giuseppe Conte had introduced several measures aimed at encouraging the use of electronic payments, most of which have since ended or been rolled back.

The introduction of fines for businesses refusing card payments was one of the financial objectives set out within Italy’s Recovery Plan (PNRR), which expressly refers to the fight against tax evasion as one of the country’s most urgent priorities. 

It is therefore likely that the new cabinet will at some point have to explain the latest U-turn on Recovery Plan policies in front of the EU Commission.

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