How much autonomy do Italian municipalities really have over their own revenue? To answer this, two distinct levels must be separated: financial autonomy - the weight of own resources within total revenue - and fiscal autonomy - the actual room for manoeuvre over local taxes, within the limits set by law. Having own resources and being able to decide on taxation are not the same thing. Understanding this distinction is the first step towards correctly reading Italian local public finance.

The difference between financial autonomy and fiscal autonomy

Take the example of Alpette, a very small municipality of 248 inhabitants belonging to the Metropolitan City of Turin. According to the analysis of SIOPE 2025 data - the Ministry of Economy's information system on the financial operations of public entities, conducted across approximately 8,000 Italian municipalities - Alpette has near-total financial autonomy (own revenue accounting for 97.9%) and fiscal autonomy equal to zero. This may seem a paradox, but it is not. Financial autonomy and fiscal autonomy are two indicators that measure different things: the former means that Alpette barely depends on external transfers, because it generates almost all of its revenue itself; the latter tells us that none of that revenue derives from locally determined tax levers such as the IMU (local property tax), TARI (waste tax), or IRPEF surcharges. The two figures coexist because non-tax revenue (service charges, fees, asset income) contributes to financial autonomy but not to fiscal autonomy. In other words, a municipality can finance itself without holding any real margin of manoeuvre over its own taxation.

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A country of ordinary and special statute regions

From the SIOPE 2025 data, the firstfinding that emerges strongly is the difference between municipalitiesbelonging to ordinary statute regions (RSO) and those belonging to specialstatute regions (RSS): Valle d'Aosta, Trentino-Alto Adige, Friuli-VeneziaGiulia, Sardinia, and Sicily. The financial autonomy of RSO municipalitiesstands at 82.8%. That of RSS municipalities falls to 48.4%. This gap of overthirty percentage points might appear to be an anomaly: are municipalities inspecial statute regions less autonomous? The answer is no - or more precisely,not in the sense one might intuitively assume.

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This difference is not a failure of the system, but an indicator of how it works. In special statute regions, resources reach municipalities mainly through the region (or autonomous province) - which retains shares of IRPEF and VAT and redistributes them locally - rather than directly from the State. What appears as "lower autonomy" is in reality a different institutional architecture: the resources are there, often in greater measure, but they reach municipalities along a different path.

More resources, through a different channel

This reading is confirmed by data on per capita current revenue. RSS municipalities receive significantly higher resources per inhabitant than ordinary statute municipalities: Valle d'Aosta reaches approximately €2,817 per inhabitant and Trentino €1,711, against an ordinary-region average ranging between €610 and €1,080. This mechanism has a direct consequence for the reading of indicators.

If financial autonomy is measured as the share of own revenue in total current revenue, RSS municipalities will always appear structurally "less autonomous" - not because they collect less, but because of a different accounting treatment of the regional transfer. It is essential to read the origin of resources alongside the overall size of the budget.
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Having resources does not mean controlling them

Back to Alpette: 97.9% financial autonomy, fiscal autonomy close to zero, no adjustable tax rate, no local tax lever. This is not an isolated case, but the norm. The reason is simple. Most of the "own" revenue of Italian municipalities does not derive from taxes that the municipality can genuinely adjust - such as the IMU, TARI, or IRPEF surcharges - but from service charges, fees, and asset income, over which discretion is limited or non-existent. Fiscal autonomy measures precisely this share: how much of its tax yield a municipality can actually govern. And the figures are low everywhere. Even in the largest cities, the urban poles, it barely reaches 6.1%. In practice, a mayor may have 85% of revenue classified as "own" while being unable to touch almost any of their local taxation. This is a critical point in the debate on differentiated autonomy and fiscal equalisation.

The demographic trap in peripheral areas

The third element of complexity concerns small municipalities, and in particular those in ultra-peripheral areas - low-density zones, far from urban poles, often in demographic decline. SIOPE shows that municipalities with fewer than 2,000 inhabitants record some of the highest per capita current revenue, at around €1,050 per inhabitant, above that of urban belts (€616 per inhabitant). At first glance they appear better resourced, but this is not the case: with very small populations, even a modest absolute revenue figure produces high per capita values. Ala di Stura, a Piedmontese municipality of 463 inhabitants, shows per capita own revenue of €1,166, well above the national average, yet total current revenue amounts to just €730,000. This is not a signal of real fiscal capacity: with few inhabitants, even modest revenue produces high per capita values. This is why the per capita figure must always be read alongside the absolute total of revenue.

Size and autonomy: diverging dynamics

The final interpretive lens concerns the relationship between demographic size and financial autonomy. Here one of the sharpest differences between the two institutional frameworks emerges. In ordinary statute municipalities, financial autonomy is remarkably stable as demographic size varies. Belt areas range between 84.9% for micro-municipalities and 89.6% for municipalities with between 5,000 and 15,000 inhabitants. Intermediate areas move between 81.7% and 86.2%. The ordinary equalisation system - whose principal redistributive instrument is the Municipal Solidarity Fund (Fondo di solidarietà comunale) - appears to guarantee relative structural uniformity, regardless of scale.

In RSS municipalities the picture is very different. Financial autonomy ranges from 48.6% in micro-municipalities (below 2,000 inhabitants) to 67.8% in cities above 50,000 inhabitants - a variation of nearly twenty percentage points. The reason is structural: the regional revenue-sharing system weighs proportionally more heavily on smaller municipalities, where own-source revenue is structurally low relative to the volume of resources transferred by the region. The smaller the municipality, the greater its dependence on the regional transfer.

What do these figures tell us?

Bringing these elements together produces a precise picture, far less simplistic than what is often read in the debate on Italian local public finance. The SIOPE data allow us to formulate at least four methodological cautions that should underpin any comparative analysis of local authorities:

• High financial autonomy does not mean decision-making autonomy: a municipality can have almost all own revenue and zero real tax levers;

• Depending on transfers does not mean having few resources: in special statute regions, municipalities often receive more resources, but through a different channel;

• High per capita values do not indicate real fiscal capacity: in small municipalities, the effect of a tiny population inflates the indicators;

• Comparing RSO and RSS with the same yardstick leads to wrong conclusions: they are institutional architectures with different logics.

Too often the same yardstick is used to measure systems that work in radically different ways. The result is a distorted map: "autonomous" municipalities that cannot move a single tax rate, "dependent" municipalities with some of the highest resources in Italy. Distinguishing is not a technical detail: it is the condition for understanding where the room for manoeuvre of those who govern a territory really ends.

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