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UPDATE 1-Italy readying 2.85 bln euro package for debt holiday, soured loans - draft

- draft@ (Adds details from the draft and background)

ROME, March 13 (Reuters) - Italy's government is studying measures worth upto 2.85 billion euros ($3.2 billion) to support a bank debt moratorium and ease disposals of problem loans, a draft decree seen by Reuters showed.

Rome is expected to approve later on Friday new measures to help families and companies fighting Europe's worst coronavirus outbreak, which is likely to have tipped the country into a recession.

Italy plans to increase its 2020 budget deficit to 2.7% of national output from a 2.2% goal set in September.

A first batch of emergency measures is aimed at preventing a rise in soured loans, which Italian banks have worked hard to reduce in recent years, the document showed.

To this aim, Rome has pencilled in 850 million euros for tax incentives.

The government also plans to spend 1.35-2.0 billion euros to provide a state guarantee on mortgages, leasing contracts, current account facilities and short-term loans close to expiring for which banks are freezing repayments.

In addition, measures worth 1 billion euros are aimed at strengthening an existing state-backed fund that helps small- and medium-sized companies to borrow more cheaply from the country's lenders.

The government is also planning to extend a temporary layoff scheme to include companies that do not qualify for it at present, to allow them to furlough workers for a limited period on a reduced salary.($1 = 0.8977 euros) (Reporting by Giuseppe Fonte, additional reporting by Stefano Bernabei, editing by Valentina Za and Carmel Crimmins)