Italy is set to reduce its building renovation incentives, impacting both homeowners and the construction industry.

Starting January, the tax deduction for renovations will drop from 50% to 36%, with further reductions planned.

This change affects those investing in energy-efficient upgrades, like replacing boilers or windows.

The popular 65% ecobonus, expiring in December, may only be renewed for primary residences focusing on energy performance.

Critics argue these cuts could slow green innovation and harm the environment, as fewer renovations mean less work for construction firms.

The government defends the move as necessary for fiscal stability, but opponents warn it could stall the housing market, reminiscent of the 2008 crisis.