Bollo auto, EU Commissioner Dombrovskis: there is room to manage cash from PNRr projects

Brussels has clarified its stance on the use of funds from the National Recovery and Resilience Plan (Pnrr) for the suspension of vehicle registration tax (bollo), stating there are margins available for liquidity management. The European Commission confirmed the interpretation of Italian Economy Minister Giancarlo Giorgetti, who argued that savings from the Pnrr could be used flexibly. According to Commissioner Valdis Dombrovskis, the Pnrr is not based on costs but on results, meaning payments can be made independently of actual expenses incurred by the country. This mechanism allows for the financial coverage needed to suspend the automobile registration tax. The clarification comes amid growing anticipation in Rome regarding another key issue affecting Italy’s fiscal situation: the update on the 2025 deficit-to-GDP ratio by the National Institute of Statistics (Istat) on September 22. If the deficit falls below the critical threshold of 3%, and is officially confirmed by Eurostat on October 21, Italy would exit the excessive deficit procedure. This outcome would allow Italy greater flexibility under the National Emergency Clause (Nec), which supports additional investments in defense and energy security. Exiting the procedure would restore credibility in financial markets, especially during heightened tensions over some sovereign bonds, which are being closely watched in the Eurozone. Beyond symbolic value, exiting the excessive deficit procedure would enable Italy to more effectively utilize the Nec clause. By exceeding the 3% deficit limit for measures agreed with the Nec, Italy would avoid triggering the excessive deficit procedure again. At the same time, this move would provide immediate market confidence. The potential benefits of such a scenario are particularly relevant given current financial market conditions. Meanwhile, the Italian request to extend the Nec to include energy security appears to be progressing without major obstacles. According to information circulating in Brussels, the list of expenditures transmitted by Rome aligns with the categories of interventions agreed upon at the European level by the 27 member states, along with the European Commission and the European Central Bank (ECB). Although the list is still under technical review by experts, it seems highly unlikely that it will not receive approval. Approval could potentially arrive as early as the October 9 EU Council Ecofin meeting, although the timing remains uncertain. Support for this possibility comes from statements by Environment Minister Gilberto Pichetto Fratin, who responded to a question about a letter from Elly Schlein on energy. He noted that some proposals align with evaluations already conducted. Regarding the "€14 billion deviation" under the Nec, he explained that together with the Ministry of Economy, a series of actions have been listed that are compatible with the direction set by the European Union. These interventions should focus on public and private building systems. On the Pnrr front, the clarification from Dombrovskis eased what had appeared just 24 hours earlier as a gap between Rome and the Berlaymont Palace. Giorgetti had essentially argued that the savings from the Pnrr loans are now "national money" because these loans, contracted through the European device, are repaid from the national budget. Any savings thus free up space for other uses. Dombrovskis acknowledged a certain margin in terms of liquidity management, clarifying that the Pnrr is based on results, not costs. Payments, in other words, are made irrespective of whether the amount received perfectly matches the actual expenditure: results count.