Rome, Italy – Italy’s ruling League party has proposed that domestic banks contribute €5 billion ($5.85 billion) to the country’s 2026 budget, reviving debate over windfall taxes on financial institutions.
In a statement issued on Saturday, the party led by Deputy Prime Minister Matteo Salvini said the measure would target “excess profits of the major credit institutions.” The plan echoes temporary bank levies implemented in other European countries during recent periods of elevated interest rates and record earnings.
Economy Minister Giancarlo Giorgetti, also a senior League member, has repeatedly highlighted what he described as “stratospheric profits” generated by Italian lenders over the past five years. According to Giorgetti, the banking sector should make a “fair contribution” to the state’s finances, especially as Rome seeks resources to balance fiscal discipline with new spending demands.
Italy attempted to impose a 40% windfall tax on bank profits in 2023, but the move triggered a sharp selloff in Milan-listed financial stocks, forcing the government to dilute the measure significantly. The League’s latest proposal could therefore face strong resistance not only from the banking industry but also from within the governing coalition itself.
Forza Italia, an ally in Prime Minister Giorgia Meloni’s administration, has already signaled opposition to renewed sector-specific taxes, warning that such measures risk destabilizing capital markets and undermining credit growth.
Still, the League argues that the Italy Bank Levy is essential to ensuring fiscal fairness. With the 2026 budget cycle approaching, the proposal sets the stage for fresh cabinet debates over how to finance Italy’s spending commitments without derailing investor confidence.
At current exchange rates, one dollar equals €0.8546.
