With the end of summer, the Government returns to work. And it does so with the 2027 Budget, one of the most important dossiers on the table. Among the many issues at the center of the discussion is the preferential taxation on allowances and salary increases linked to shifts, nights and holidays. The main hypothesis is the confirmation, also for next year, of the 15% substitute tax. On the table, however, there is also a possible strengthening of the measure, with the rate reduced to 5%.
How the 15% tax rate works in 2026
With the Budget Law for 2026 it was established that, for the entire tax period, the sums paid to employees in the private sector are subject to a substitute tax for Irpef and regional and municipal surcharges equal to 15%, within an annual limit of 1,500 euros. The measure concerns three categories of sums:
- increases and allowances for night work, provided for by article 1, paragraph 2, of Legislative Decree 66/2003 and by national collective labor agreements;
- increases and allowances for work performed on public holidays and weekly rest days, as identified by the Ccnl;
- shift allowance and other emoluments connected to shift work, provided for by the Ccnl.
The benefit is reserved for workers with a 2025 income not exceeding 40 thousand euros. Alongside this measure, the 2026 Budget Law also proposed the supplementary treatment of 15% on gross wages for night work and overtime on holidays, applicable from 1 January to 30 September 2026.
The hypothesis of extension to 2027
The measure could also be confirmed for 2027. The Ministry of Labor is preparing a package of relief for the 2027 budget which, according to initial estimates, should exceed 2 billion euros. Among the fixed points, the reconfirmation of the reductions in contributions for the stable hiring of young people and women, for businesses in the SEZs and for the stabilization of temporary workers.
On the salary front, the confirmation of 15% taxation on allowances and increases for night, weekend and shift work is currently being studied, as also reported by journalistic sources following the majority negotiations. This would be a simple extension of the conditions already in force in 2026, including the ceiling of 1,500 euros per year and the income restriction of 40 thousand euros.
The alternative proposal: 5% rate
The package, however, would not stop at just the extension. Among the proposals there is also the introduction of a 5% rate on contract renewals, night work and overtime, as well as a 1% substitute tax on productivity bonuses. In this case, it would not be a confirmation but a strengthening of the relief, because the rate would drop from the current 15% to 5%, reducing the applied rate by two thirds.
The benefits for workers
The lower the rate, the less tax paid and the higher the net paycheck. Therefore, for a worker, up to a maximum of 1,500 euros per year, the difference between the two options is concrete:
- with 15%, the tax due is 225 euros, net 1,275 euros;
- with 5%, the tax due is 75 euros, net 1,425 euros;
The saving for the worker would therefore be 150 euros per year, i.e. a third of the current taxation.
