The 2025 budget plan in Italy brings substantial modifications to the tax deduction system for home renovation expenses. It establishes a clear distinction between properties, specifically affecting the deductions available for the years 2025-2026. While the tax deduction remains at 50% for work conducted on the primary residence—where the owner is officially registered and lives—the deduction for expenses related to secondary properties sees a drastic reduction to 36%. This change has led to confusion among citizens, with many feeling uncertain about how to proceed with their renovation projects. Some are even considering resorting to unreported labor to circumvent the new rules.

The implications of this policy shift are particularly noticeable in condominium settings, where members are required to submit invoices to provide a clear account of expenses. As a result, condominium owners are likely to benefit the most from this change in the 730 model, as expenditures must be documented and reported accurately. However, the reduced incentive for renovations on secondary homes may lead to a stagnation in property improvements and alter the dynamics of the housing market.

In summary, the changes to tax deductions in the 2025 budget highlight the Italian government's efforts to regulate and track home improvement spending. This policy may encourage homeowners to focus their renovation efforts on their primary residences, potentially impacting the demand and investment in secondary homes. The uncertainty surrounding these new deductions also raises concerns about the effectiveness of the policy in stimulating the renovation sector, as homeowners weigh their options against possible financial risks.