Italy remains above the deficit threshold required to close the EU procedure in 2026

The Commission explains that budgetary flexibility cannot replace the condition of a deficit below 3% of GDP for 2025. Rome’s request for an additional margin for defence and energy is still under consideration, and Italian data are to be verified by Eurostat.

Italy remains above the deficit threshold required to exit the European excessive deficit procedure in 2026, after Istat data indicated a deficit of 3.1% of gross domestic product for 2025. The European Commission explained that any approval of the national escape clause would not remove the condition that last year’s deficit be below 3%, while Rome’s request for budgetary flexibility is still being assessed.

In brief

1. The deficit of 3.1% of GDP for 2025 exceeds the threshold required to close the procedure in 2026. The Commission states that, for last year’s result, the condition applies regardless of the escape clause.

2. Any closure also requires forecasts showing that the deficit will remain below 3% in 2026 and 2027. Budgetary flexibility may be taken into account in this assessment of the following years.

3 Italy’s request, received on 11 September, is still under consideration. Activating the clause requires the Council’s approval, and the Commission has not confirmed a deadline for its own assessment.

At the Commission’s press briefing, economy spokesperson Balazs Ujvari described two conditions for closing the procedure this year. The first concerns the actual result for 2025, which must be below the 3% threshold, regardless of the escape clause. The second concerns the forecasts for 2026 and 2027, which must show that the deficit remains below this level; budgetary flexibility granted through the clause may be taken into account in this assessment of the following years.

However, the Commission did not present the figure of 3.1% as the result of a verification already completed by Eurostat. Ujvari stated that Member States submit data on the deficit and public debt twice a year, with the next deadline being 1 October. Eurostat is to verify the information, and the European executive will conduct its assessment as part of the autumn package of the European Semester. The figure published by the Italian authorities remains, from the perspective of this European verification, a preliminary one.

In Rome, Minister of Economy and Finance Giancarlo Giorgetti acknowledged that the government was not achieving the early exit from the procedure that it had hoped for this year. In a statement reported by ANSA, he indicated 2027 as a possible date for closure, in line with the Italian public finance document. This is the perspective expressed by the minister, without representing a decision by the European institutions.

Italy already has a timetable for correcting the deficit. The recommendation adopted by the EU Council in January 2025 calls for the excessive deficit situation to be eliminated by 2026 and limits the nominal growth of net expenditure to 1.3% in 2025 and 1.6% in 2026. This timetable concerns the year in which the deficit must be corrected, while closing the procedure requires an assessment of budgetary results and the sustainability of the correction.

In parallel, Rome requested the activation of the national escape clause, a request received by the Commission on 11 September. According to ANSA, which cited government sources, the move seeks to obtain a margin for investments in defence and energy. The mechanism allows a state to temporarily deviate from the budgetary path established by the Council in exceptional circumstances beyond its control, with a major impact on public finances. One condition remains that this deviation must not endanger medium-term fiscal sustainability.

The Commission’s guidelines from August provide for extending flexibility for defence to certain energy-security measures. Interventions that structurally reduce dependence on fossil fuels are covered, such as investments in electricity grids and clean-energy storage; reductions in excise duties on fossil fuels and subsidies for them are excluded. For eligible energy measures, the ceiling is 0.3% of GDP annually and 0.6% cumulatively over the period 2026–2028. These limits describe the assessment framework, without constituting amounts already approved for Italy.

The Commission has not confirmed that it will complete its analysis of the Italian request before the meeting of finance ministers on 9 October, a deadline mentioned by a journalist at the briefing. Ujvari said that the assessment has no deadline laid down in the regulations and that the institution is working as quickly as possible. Activation then requires the Council’s approval, based on the Commission’s assessment and recommendation; according to the spokesperson, the Council has one month for this step.

https://2eu.brussels/ro/news/italia-ramane-peste-pragul-de-deficit-necesar-pentru-inchiderea-procedurii-ue-in-2026