Italy says EU should consider pausing budget rules if Iran crisis persists

European Union authorities should consider a temporary suspension of budget deficit rules if the U.S.-Israeli war against Iran flares up again, Prime Minister Giorgia Meloni told parliament on Thursday (April 9).

Meloni also said her government was ready to take every possible measure to prevent potential speculative behavior on energy prices, including introducing windfall taxes on energy companies.

"We believe that discussing a possible temporary suspension of the Stability and Growth Pact should not be taboo. Not a waiver for individual Member States, but a general measure," Meloni said.

Her remarks come as the government is preparing to cut its GDP growth estimates for 2026 and following years later this month, making it more difficult for Italy to bring its deficit below the EU's 3% of GDP ceiling this year, as planned.

"Italy remains ready to take every possible measure to prevent potential speculative behavior (on energy prices), including, if necessary, further action regarding the profits of energy companies," Meloni added.

Meloni and her predecessor Mario Draghi adopted in recent years windfall taxes on the energy sector, triggering legal disputes with affected companies.

-Cristiano Corvino, Oriana Boselli/Reuters